exv4w8



 





Exhibit 4.8









INDENTURE




by and between




CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1,

as the Issuer,




and




WELLS FARGO BANK, NATIONAL ASSOCIATION,

not in its individual capacity but solely in its capacity

as the Indenture Trustee




Dated as of June 22, 2004









CapitalSource Commercial Loan Trust 2004-1 Asset Backed Notes, Series 2004-1

Class A-1, Class A-2, Class B, Class C, Class D and Class E Notes




 









 






TABLE OF CONTENTS



	 	 	 	 	 
	 	 	Page
	ARTICLE I   DEFINITIONS
	 	 	2	 
	Section 1.01 Definitions
	 	 	2	 
	Section 1.02 Rules of Construction
	 	 	8	 
	ARTICLE II   THE NOTES
	 	 	9	 
	Section 2.01 Form
	 	 	9	 
	Section 2.02 Execution, Authentication and Delivery
	 	 	9	 
	Section 2.03 Opinions of Counsel
	 	 	10	 
	ARTICLE III   COVENANTS
	 	 	10	 
	Section 3.01 Collection of Payments on Loans; Trust Accounts.
	 	 	10	 
	Section 3.02 Maintenance of Office or Agency
	 	 	10	 
	Section 3.03 Money for Payments To Be Held in Trust; Paying Agent
	 	 	11	 
	Section 3.04 Existence
	 	 	13	 
	Section 3.05 Payment of Principal and Interest
	 	 	13	 
	Section 3.06 Protection of Indenture Collateral
	 	 	13	 
	Section 3.07 Opinions as to Indenture Collateral
	 	 	14	 
	Section 3.08 Furnishing of Rule 144A Information
	 	 	15	 
	Section 3.09 Performance of Obligations; Sale and Servicing Agreement
	 	 	15	 
	Section 3.10 Negative Covenants
	 	 	16	 
	Section 3.11 Annual Statement as to Compliance
	 	 	16	 
	Section 3.12 Recording of Assignments
	 	 	17	 
	Section 3.13 Representations and Warranties Concerning the Loans
	 	 	17	 
	Section 3.14 Indenture Trustee’s Review of Loan Files
	 	 	17	 
	Section 3.15 Indenture Collateral; Related Documents
	 	 	17	 
	Section 3.16 Amendments to Sale and Servicing Agreement
	 	 	18	 
	Section 3.17 Servicer as Agent and Bailee of Indenture Trustee
	 	 	18	 
	Section 3.18 Investment Company Act
	 	 	18	 
	Section 3.19 Issuer May Consolidate, etc., Only on Certain Terms
	 	 	19	 
	Section 3.20 Successor or Transferee
	 	 	20	 
	Section 3.21 No Other Business
	 	 	20	 
	Section 3.22 No Borrowing
	 	 	21	 







-i-









 





TABLE OF CONTENTS
(continued)



	 	 	 	 	 
	 	 	Page
	Section 3.23 Guarantees, Loans, Advances and Other Liabilities
	 	 	21	 
	Section 3.24 Capital Expenditures
	 	 	21	 
	Section 3.25 Representations and Warranties of the Issuer
	 	 	21	 
	Section 3.26 Restricted Payments
	 	 	23	 
	Section 3.27 Notice of Events of Default
	 	 	24	 
	Section 3.28 Further Instruments and Acts
	 	 	24	 
	Section 3.29 Statements to Noteholders
	 	 	24	 
	Section 3.30 Grant of Substitute Loans
	 	 	25	 
	Section 3.31 Determination of LIBOR; Note Interest Rate; Interest Distributable
	 	 	25	 
	Section 3.32 Covenants of the Issuer Relating to Hedge Agreements
	 	 	25	 
	Section 3.33 Payments from Obligor Lock–Boxes and Obligor Lock–Box Accounts
	 	 	27	 
	Section 3.34 Maintenance of Listing
	 	 	27	 
	ARTICLE IV   THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE
	 	 	28	 
	Section 4.01 The Notes
	 	 	28	 
	Section 4.02 Registration of Transfer and Exchange of Notes
	 	 	28	 
	Section 4.03 Mutilated, Destroyed, Lost or Stolen Notes
	 	 	37	 
	Section 4.04 Payment of Principal and Interest; Defaulted Interest
	 	 	38	 
	Section 4.05 Tax Treatment
	 	 	39	 
	Section 4.06 Satisfaction and Discharge of Indenture
	 	 	40	 
	Section 4.07 Application of Trust Money
	 	 	41	 
	Section 4.08 Repayment of Moneys Held by Paying Agent
	 	 	41	 
	ARTICLE V   REMEDIES
	 	 	41	 
	Section 5.01 Events of Default
	 	 	41	 
	Section 5.02 Acceleration of Maturity; Rescission and Annulment
	 	 	43	 
	Section 5.03 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee
	 	 	44	 
	Section 5.04 Remedies; Priorities
	 	 	46	 
	Section 5.05 Optional Preservation of the Indenture Collateral
	 	 	48	 







-ii-









 





TABLE OF CONTENTS
(continued)



	 	 	 	 	 
	 	 	Page
	Section 5.06 Limitation of Suits
	 	 	48	 
	Section 5.07 Unconditional Rights of Noteholders To Receive Principal and Interest
	 	 	49	 
	Section 5.08 Restoration of Rights and Remedies
	 	 	49	 
	Section 5.09 Rights and Remedies Cumulative
	 	 	50	 
	Section 5.10 Delay or Omission Not a Waiver
	 	 	50	 
	Section 5.11 Control by Noteholders
	 	 	50	 
	Section 5.12 Waiver of Past Defaults
	 	 	51	 
	Section 5.13 Undertaking for Costs
	 	 	51	 
	Section 5.14 Waiver of Stay or Extension Laws
	 	 	52	 
	Section 5.15 Sale of Indenture Collateral
	 	 	52	 
	Section 5.16 Action on Notes
	 	 	53	 
	Section 5.17 Performance and Enforcement of Certain Obligations
	 	 	54	 
	ARTICLE VI   THE INDENTURE TRUSTEE
	 	 	54	 
	Section 6.01 Duties of Indenture Trustee
	 	 	54	 
	Section 6.02 Rights of Indenture Trustee
	 	 	56	 
	Section 6.03 Individual Rights of Indenture Trustee
	 	 	57	 
	Section 6.04 Indenture Trustee’s Disclaimer
	 	 	57	 
	Section 6.05 Notice of Event of Default
	 	 	57	 
	Section 6.06 Reports by Indenture Trustee to Holders
	 	 	57	 
	Section 6.07 Compensation and Indemnity
	 	 	58	 
	Section 6.08 Replacement of Indenture Trustee
	 	 	58	 
	Section 6.09 Successor Indenture Trustee by Merger
	 	 	60	 
	Section 6.10 Appointment of Co–Indenture Trustee or Separate Indenture Trustee
	 	 	60	 
	Section 6.11 Eligibility; Disqualification
	 	 	61	 
	Section 6.12 Representations, Warranties and Covenants of Indenture Trustee
	 	 	62	 
	Section 6.13 Directions to Indenture Trustee
	 	 	63	 
	Section 6.14 Conflicts
	 	 	63	 







-iii-









 






TABLE OF CONTENTS
(continued)



	 	 	 	 	 
	 	 	Page
	ARTICLE VII   NOTEHOLDERS’ LISTS AND REPORTS
	 	 	63	 
	Section 7.01 Issuer To Furnish Indenture Trustee Names and Addresses of Noteholders
	 	 	63	 
	Section 7.02 Preservation of Information; Communications to Noteholders
	 	 	64	 
	Section 7.03 Fiscal Year
	 	 	64	 
	Section 7.04 Reports to Irish Stock Exchange, Etc.
	 	 	64	 
	ARTICLE VIII   TRUST ACCOUNTS, DISBURSEMENTS AND RELEASES
	 	 	64	 
	Section 8.01 Collection of Money
	 	 	64	 
	Section 8.02 Trust Accounts
	 	 	65	 
	Section 8.03 Opinion of Counsel
	 	 	65	 
	Section 8.04 Termination Upon Distribution to Noteholders
	 	 	66	 
	Section 8.05 Release of Indenture Collateral
	 	 	66	 
	Section 8.06 Surrender of Notes Upon Final Payment
	 	 	66	 
	ARTICLE IX   SUPPLEMENTAL INDENTURES
	 	 	67	 
	Section 9.01 Supplemental Indentures Without Consent of Noteholders
	 	 	67	 
	Section 9.02 Supplemental Indentures With Consent of Noteholders
	 	 	68	 
	Section 9.03 Execution of Supplemental Indentures
	 	 	70	 
	Section 9.04 Effect of Supplemental Indenture
	 	 	70	 
	Section 9.05 Reference in Notes to Supplemental Indentures
	 	 	70	 
	ARTICLE X   OPTIONAL REDEMPTION OF NOTES
	 	 	71	 
	Section 10.01 Optional Redemption
	 	 	71	 
	Section 10.02 Form of Redemption Notice
	 	 	71	 
	Section 10.03 Notes Payable on Redemption Date
	 	 	72	 
	ARTICLE XI   MISCELLANEOUS
	 	 	72	 
	Section 11.01 Compliance Certificates and Opinions, etc.
	 	 	72	 
	Section 11.02 Form of Documents Delivered to Indenture Trustee
	 	 	73	 
	Section 11.03 Acts of Noteholders
	 	 	74	 
	Section 11.04 Notices, etc., to Indenture Trustee and Others
	 	 	74	 
	Section 11.05 Notices to Noteholders; Waiver
	 	 	75	 
	Section 11.06 Alternate Payment and Notice Provisions
	 	 	76	 







-iv-









 






TABLE OF CONTENTS
(continued)



	 	 	 	 	 
	 	 	Page
	Section 11.07 Effect of Headings
	 	 	76	 
	Section 11.08 Successors and Assigns
	 	 	76	 
	Section 11.09 Severability
	 	 	76	 
	Section 11.10 Benefits of Indenture
	 	 	77	 
	Section 11.11 Legal Holidays
	 	 	77	 
	Section 11.12 GOVERNING LAW
	 	 	77	 
	Section 11.13 Counterparts
	 	 	77	 
	Section 11.14 Issuer Obligation
	 	 	77	 
	Section 11.15 No Petition
	 	 	78	 
	Section 11.16 Inspection; Confidentiality
	 	 	78	 
	Section 11.17 Limitation of Liability
	 	 	79	 
	Section 11.18 Disclaimer and Subordination
	 	 	79	 







EXHIBITS




	 	 	 	 	 
	Exhibit A–1

	 	—
	 	Form of Class A-1 Note
	 
	 	 	 	 
	Exhibit A–2

	 	—
	 	Form of Class A-2 Note
	 
	 	 	 	 
	Exhibit A–3

	 	—
	 	Form of Class B Note
	 
	 	 	 	 
	Exhibit A–4

	 	—
	 	Form of Class C Note
	 
	 	 	 	 
	Exhibit A–5

	 	—
	 	Form of Class D Note
	 
	 	 	 	 
	Exhibit A–6

	 	—
	 	Form of Class E Note
	 
	 	 	 	 
	Exhibit B

	 	—
	 	List of Loans
	 
	 	 	 	 
	Exhibit C

	 	—
	 	Form of Wiring Instructions
	 
	 	 	 	 
	Exhibit D–1

	 	—
	 	Form of Transferee Letter [Non–Rule 144A]
	 
	 	 	 	 
	Exhibit D–2

	 	—
	 	Form of Rule 144A Certification
	 
	 	 	 	 
	Exhibit E

	 	—
	 	Form of Transfer Certificate for Rule 144A Global
Note to Regulation S Global Note during Distribution
Compliance Period
	 
	 	 	 	 
	Exhibit F

	 	—
	 	Form of Transfer Certificate for Rule 144A Global
Note to Regulation S Global Note after Distribution
Compliance Period
	 
	 	 	 	 
	Exhibit G

	 	—
	 	Form of Transfer Certificate for Regulation S Global
Note to Rule 144A Global Note during Distribution
Compliance Period
	 
	 	 	 	 
	Exhibit H

	 	—
	 	Form of Transfer Certificate for Regulation S Global
Note during Distribution Compliance Period







-v-









 






INDENTURE




     THIS INDENTURE, dated as of June 22, 2004 (as amended, modified, restated,
supplemented or waived from time to time, the “Indenture”), is by and
between CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1, a Delaware statutory trust,
as the issuer (together with its successors and assigns in such capacity, the
“Issuer”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, not in its
individual capacity but solely in its capacity as the indenture trustee
(together with its successors and assigns, in such capacity, the “Indenture
Trustee”).



     Each party hereto agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Issuer’s Notes and the
Hedge Counterparties.



GRANTING CLAUSE




     The Issuer hereby Grants to the Indenture Trustee, on behalf of and for
the benefit of the Holders of the Notes and the Hedge Counterparties, without
recourse, subject to the terms of this Indenture and the other Transaction
Documents, a continuing security interest in and lien on all of its right,
title and interest in and to all accounts, cash and currency, chattel paper,
electronic chattel paper, tangible chattel paper, copyrights, copyright
licenses, equipment, fixtures, general intangibles, instruments, commercial
tort claims, deposit accounts, inventory, investment property, letter of credit
rights, software, supporting obligations, accessions, and other property
consisting of, arising out of, or related to (i) the Loans and all other assets
included or to be included from time to time in the Loan Assets, whether now
existing or hereafter arising or acquired, other than the Retained Interest, if
any, as it may exist from time to time, (ii) all payments under any Hedge
Agreement, and (iii) all present and future claims, demands, causes and choses
in action in respect of any or all of the foregoing and all payments on or
under and all proceeds of every kind and nature whatsoever in respect of any or
all of the foregoing, including all proceeds of the conversion, voluntary or
involuntary, into cash or other liquid property, all cash proceeds, accounts,
accounts receivable, notes, drafts, acceptances, chattel paper, checks, deposit
accounts, insurance proceeds, condemnation awards, rights to payment of any and
every kind and other forms of obligations and receivables, instruments and
other property which at any time constitute all or part of or are included in
the proceeds of any of the foregoing (collectively, the “Indenture
Collateral”).



     The foregoing Grant is made in trust to secure (x) the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes and all other sums owing by the Issuer hereunder or under any other
Transaction Document or under any Hedge Transaction, and (y) to secure
compliance with the covenants and agreement in this Indenture, the Hedge
Agreement and the other Transaction Documents.



     The Indenture Trustee, on behalf of the Noteholders and on behalf of the
Hedge Counterparties (1) acknowledges such Grant, and (2) accepts the trusts
under this Indenture in accordance with this Indenture and agrees to perform
its duties required in this Indenture to the best of its ability to the end
that the interests of the Noteholders and Hedge Counterparties may be
adequately and effectively protected.



 









 





ARTICLE I




DEFINITIONS




     Section 1.01 Definitions.



     Certain defined terms used throughout the Indenture are defined above or
in this Section 1.01. In addition, except as otherwise expressly
provided herein or unless the context otherwise requires, capitalized terms
used but not otherwise defined herein shall have the meanings given to such
terms in the Sale and Servicing Agreement (as defined below), which are
incorporated by reference herein.



     “Accredited Investors” shall have the meaning specified in Rule
501(a)(1)–(3) or (7) under the Securities Act.



     “Applicable Procedures” has the meaning given to such term in
subsection 4.02(j)(i).



     “Authorized Newspaper” means a newspaper of general circulation in
the Borough of Manhattan, The City of New York, printed in the English language
and customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays.



     “Authorized Officer” means, (i) with respect to any Person, any
person who is authorized to act for such Person in matters relating to the
Transaction Documents and whose action is binding upon such Person, (ii) with
respect to the Issuer, any officer of the Owner Trustee who is authorized to
act for the Owner Trustee in matters relating to the Issuer, (iii) with respect
to the Trust Depositor or the Servicer, initially those individuals the names
of whom appear on the lists of Authorized Officers delivered on the Closing
Date (as such list may be modified or supplemented from time to time
thereafter), and (iv) with respect to the Indenture Trustee, the Chairman or
Vice President of the Board of Directors or Trustees, the Chairman or Vice
Chairman of the Executive or Standing Committee of the Board of Directors or
Trustees, the President, the Chairman of the Committee on Trust Matters, any
vice president, any assistant vice president, the Secretary, any assistant
secretary, the Treasurer, any assistant treasurer, the Cashier, any assistant
cashier, any trust officer, the Controller and any assistant controller or any
other officer of the Indenture Trustee customarily performing functions similar
to those performed by any of the above designated officers and also, with
respect to a particular matter, any other officer to whom such matter is
referred because of such officer’s knowledge of and familiarity with particular
subject.



     “Beneficial Owner” means, with respect to a Note, the Person who is
the beneficial owner of such Note, as reflected on the books of the Depository
or on the books of a Person maintaining an account with such Depository
(directly or as an indirect participant, in accordance with the rules of such
Depository), as the case may be.



     “CapitalSource” means CapitalSource Finance LLC, together with its
successors and assigns.


     “Certificate Registrar” means initially, the Indenture Trustee, and
thereafter, any successor appointed pursuant to the Trust Agreement.


2









 







     “Clearstream” means Clearstream Banking, a société anonyme, a
limited liability company organized under the laws of Luxembourg.



     “Corporate Trust Office” means in the case of Owner Trustee:
Wilmington Trust Company, One Rodney Square North, Wilmington, Delaware 19890,
Attention: Corporate Trust Administration and in the case of the Indenture
Trustee: Wells Fargo Bank, National Association, Sixth and Marquette Avenue,
MAC N9311–161, Minneapolis, Minnesota 55479, Attention: Corporate Trust
Services/Asset Backed Administration, or at such other address as the Owner
Trustee or the Indenture Trustee may designate from time to time by notice to
the Issuer, or the principal corporate trust officer of any successor Owner
Trustee or Indenture Trustee at the address designated by such successor by
notice to the Issuer.



     “Credit Support Provider” means, in respect of a Hedge
Counterparty, any Person providing credit support on behalf of such Hedge
Counterparty.



     “Default” means any occurrence that is, or with notice or the lapse
of time or both would become, an Event of Default.



     “Depository” means The Depository Trust Company or its successors
or assigns.



     “Depository Participant” means a Person for whom, from time to
time, the Depository effects book–entry transfers and pledges of securities
deposited with the Depository.



     “Direct Participant” means any broker–dealer, bank or other
financial institution for whom the nominee of the Depository holds an interest
in any Note.



     “Distribution Compliance Period” means the 40 day period prescribed
by Regulation S commencing on the later of (a) the date upon which Notes are
first offered to Persons other than the Initial Purchasers and any other
distributor (as such term is defined in Regulation S) of the Notes and (b) the
Closing Date.



     “DTC” means The Depository Trust Company, and its successors.



     “DTC Custodian” means the Indenture Trustee as a custodian for DTC.



     “ERISA” means the Employee Retirement Income Security Act of 1974,
as amended from time to time, or any successor legislation thereto and the
regulations promulgated and the rulings issued thereunder.



     “Euroclear” means the Euroclear System, operated by Morgan Guaranty
Trust Company of New York, Brussels office.



     “Event of Default” has the meaning given to such term in Section
5.01.



     “Fixed Rate Permitted Excess Amount” means, with respect to Fixed
Rate Loans, $250,000.



3









 





     “Floating Prime Rate Permitted Excess Amount” means, with respect
to Floating Prime Rate Loans, $250,000.



     “Global Note” means any Note registered in the name of the
Depository or its nominee, beneficial interests of which are reflected on the
books of the Depository or on the books of a Person maintaining any account
with such Depository (directly or as an indirect participant in accordance with
the rules of such Depository). The Global Note shall include the Rule 144A
Global Notes and the Regulation S Global Notes.



     “Grant” means to mortgage, pledge, sell, bargain, warrant,
alienate, remise, release, convey, assign, transfer, create, and grant a lien
upon and a security interest in and right of set–off against, deposit, set over
and confirm pursuant to the Indenture. A Grant of Indenture Collateral or of
any other agreement or instrument shall include all rights, powers and options
(but none of the obligations) of the granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments in respect of such collateral or other
agreement or instrument and all other moneys payable thereunder, to give and
receive notices and other communications, to make waivers or other agreements,
to exercise all rights and options, to bring proceedings in the name of the
granting party or otherwise, and generally to do and receive anything that the
granting party is or may be entitled to do or receive thereunder or with
respect thereto.



     “Indenture Collateral” has the meaning given to such term in the
Granting Clauses.



     “Indenture Trustee” has the meaning given to such term in the
Preamble.



     “Indirect Participant” means any financial institution for whom any
Direct Participant holds an interest in any Note.



     “Individual Note” means any Note in permanent certificated form
registered in the name of a holder other than the Depository or its nominee.



     “Initial Purchasers” means Citigroup Global Markets Inc., Wachovia
Capital Markets, LLC and Harris Nesbitt Corp.



     “Institutional Accredited Investor” means any Person meeting the
requirements of Rule 501 (a) (1) – (3) or (7) of Regulation D under the
Securities Act.



     “Issuer Order” means a written order or request signed in the name
of the Issuer by any one of its Authorized Officers and delivered to the
Indenture Trustee or by the Servicer on behalf of the Issuer.



     “Legal Final Maturity Date” means April 20, 2013.



     “Letter of Representations” means the Letter of Representations,
dated as of June 22, 2004, by and among the Issuer, the Indenture Trustee and
the Depository.



     “Note Register” has the meaning given to such term in subsection
4.02(a).



4









 





     “Note Registrar” has the meaning given to such term in
subsection 4.02(a).



     “Outstanding” means as of the date of determination, all Notes
theretofore executed, authenticated and delivered under the Indenture except:



     (i) Notes in exchange for or in lieu of which other Notes have been
executed, authenticated and delivered pursuant to the Indenture unless proof
satisfactory to the Indenture Trustee is presented that any such Notes are held
by a holder in due course;



     (ii) Notes to be redeemed and in respect of which money in the necessary
amount to pay the Redemption Price has been theretofore deposited with the
Indenture Trustee in trust for the Noteholders (provided,
however, that notice of such redemption has been duly given pursuant to
Section 10.02 hereof); and



     (iii) Notes theretofore canceled by the Note Registrar or delivered to the
Indenture Trustee for cancellation.



     “Owner” means each Holder of a Note.



     “Owner Trustee” means Wilmington Trust Company, not in its
individual capacity but solely as owner trustee under the Trust Agreement, and
any successor Owner Trustee thereunder.



     “Participant” means a Person that has an account with DTC.



     “Paying Agent” means, with respect to the Notes, any paying agent
or co–paying agent appointed pursuant to Section 3.03 of the Indenture,
which initially shall be (i) the Indenture Trustee and (ii) with respect to the
payment of principal and interest on those Class A-1 Notes, Class A-2 Notes,
Class B Notes, Class C Notes and Class D Notes listed on the Irish Stock
Exchange only, JP Morgan Bank (Ireland) PLC. With respect to the Trust
Certificates, any paying agent or co–paying agent appointed pursuant to
Section 3.09 of the Trust Agreement which initially shall be Wells Fargo
Bank, National Association.



     “Percentage Interest” means, with respect to a Class A-1 Note,
Class A-2 Note, Class B Note, Class C Note, Class D Note or Class E Note, the
fraction, expressed as a percentage, the numerator of which is the denomination
represented by such Class A-1 Note, Class A-2 Note, Class B Note, Class C Note,
Class D Note or Class E Note and the denominator of which is the Initial Class
A-1 Principal Balance, the Initial Class A-2 Principal Balance, the Initial
Class B Principal Balance, the Initial Class C Principal Balance, the Initial
Class D Principal Balance or the Initial Class E Principal Balance, as the case
may be. With respect to a Trust Certificate, the percentage set forth on the
face thereof.



     “Plan” has the meaning given to such term in subsection
4.02(t).



     “Proceeding” means any suit in equity, action at law or other
judicial or administrative proceeding.



     “Qualified Institutional Buyer” has the meaning given to such term
in Rule 144A under the Securities Act.



5









 





     “Redemption Date” means in the case of a redemption of the Notes
pursuant to Section 10.01 of this Indenture, the Remittance Date
specified by the Issuer pursuant to Section 10.01 of this Indenture.



     “Redemption Price” means, in the case of a redemption of the Notes
pursuant to Section 10.01 of this Indenture, an amount equal to the then
outstanding principal amount of each class of Notes being redeemed plus accrued
and unpaid interest thereon to but excluding the Redemption Date plus all other
amounts accrued and unpaid with respect thereto, together with all amounts then
owing to each Hedge Counterparty, including Hedge Breakage Costs, plus, without
duplication, all amounts payable to each Hedge Counterparty upon termination of
all Hedge Transactions in connection with a redemption of the Notes, including
Hedge Breakage Costs.



     “Regulation S” means Regulation S under the Securities Act.



     “Regulation S Global Notes” means the Notes sold in offshore
transactions in reliance on Regulation S and represented by one or more Global
Notes deposited with the Indenture Trustee as custodian for the Depository.



     “Regulation S Investor” means, with respect to a transferee of a
Regulation S Global Note pursuant to Regulation S.



     “Rule 144A Certification” means a letter substantially in the form
attached to the Indenture as Exhibit D–2.



     “Rule 144A Global Notes” means the Notes sold within the United
States to U.S. Persons, initially issued to Qualified Institutional Buyers in
the form of beneficial interests in one or more Global Notes, deposited with
the Indenture Trustee as custodian for the Depository.



     “Sale” has the meaning given to such term in Section 5.15.



     “Sale and Servicing Agreement” means the Sale and Servicing
Agreement, dated as of June 22, 2004, by and among CapitalSource Commercial
Loan Trust 2004-1, as the Trust, CapitalSource Commercial Loan LLC, 2004-1, as
the Trust Depositor, CapitalSource Finance LLC, as the Originator and as the
Servicer, and Wells Fargo Bank, National Association, as the Indenture Trustee
and the Backup Servicer.



     “Securities Legend” “THIS NOTE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES OR BLUE SKY LAW OF
ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT THIS NOTE
MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS AND ONLY (1) PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE
HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED



6









 





THAT THE
REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (2) IN CERTIFICATED FORM TO AN INSTITUTIONAL “ACCREDITED INVESTOR”
(WITHIN THE MEANING OF RULE 501 (a)(1)–(3) OR (7) UNDER THE SECURITIES ACT) WHO
IS ALSO A QUALIFIED PURCHASER FOR PURPOSES OF SECTION 3(c)(7) UNDER THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED, PURCHASING FOR INVESTMENT AND NOT
FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, IN EACH CASE, SUBJECT TO
(A) THE RECEIPT BY THE INDENTURE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM
PROVIDED IN THE INDENTURE AND (B) THE RECEIPT BY THE INDENTURE TRUSTEE OF SUCH
OTHER EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE THAT SUCH REOFFER, RESALE,
PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
REQUIREMENTS OF LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND BLUE SKY LAWS OF ANY
STATE OF THE UNITED STATES AND ANY OTHER APPLICABLE JURISDICTION, (3) IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, (4) PURSUANT TO ANOTHER EXEMPTION AVAILABLE UNDER THE
SECURITIES ACT AND IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS, OR
(5) PURSUANT TO A VALID REGISTRATION STATEMENT. THE PURCHASE OF THIS NOTE WILL
BE DEEMED A REPRESENTATION BY THE ACQUIRER THAT EITHER: (I) IT IS NOT, AND IS
NOT PURCHASING THIS NOTE FOR, ON BEHALF OF OR WITH THE ASSETS OF, AN EMPLOYEE
BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF
ERISA AND/OR SECTION 4975 OF THE CODE OR (II) THE PURCHASE AND HOLDING OF THIS
NOTE BY THE ACQUIRER WILL NOT RESULT IN A NON EXEMPT PROHIBITED TRANSACTION
UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE.”



     “Series” means 2004-1.



     “Servicer’s Certificate” means the certificate as defined in
Section 9.02 of the Sale and Servicing Agreement.



     “Termination Price” means the price calculated in accordance with
Section 10.01 of the Sale and Servicing Agreement.



     “Transfer” has the meaning given to such term in subsection
4.02(r).



     “Transferee Letter” means the letter set forth in Exhibit
D–1 to the Indenture.



     “Trust Certificate” means a certificate evidencing the beneficial
interest of a Certificateholder in the Issuer, substantially in the form of
Exhibit A attached to the Trust Agreement.



     “Trust Company” means Wilmington Trust Company (and any successor
thereto or assign thereof), in its individual capacity, and any other Person
who shall act as Owner Trustee under the Trust Agreement, in its individual
capacity.



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     “Trust Indenture Act” or “TIA” means the Trust Indenture Act
of 1939, as amended from time to time, as in effect on any relevant date.



     “U.S. Person” means a person that is a citizen or resident of the
United States, a corporation or partnership (except as provided in applicable
Treasury regulations) created or organized in or under the laws of the United
States, any State or the District of Columbia, including any entity treated as
a corporation or partnership for federal income tax purposes, an estate whose
income is subject to United States federal income tax regardless of its source,
or a trust if a court within the United States is able to exercise primary
supervision over the administration of such trust, and one or more such U.S.
Persons have the authority to control all substantial decisions of such trust
(or, to the extent provided as applicable Treasury regulations, certain trusts
in existence on August 20, 1996 which are eligible to elect to be treated as a
U.S. Person).



     “USA PATRIOT Act” means the United States Uniting and Strengthening
America By Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001, signed into law on and effective as of October 26, 2001,
which, among other things, requires that financial institutions, a term that
includes banks, broker-dealers and investment companies, establish and maintain
compliance programs to guard against money laundering activities.



     Section 1.02 Rules of Construction.



     Unless the context otherwise requires:



     (i) a term has the meaning given to it;



     (ii) an accounting term not otherwise defined has the meaning given
to it in accordance with generally accepted accounting principles;



     (iii) “or” is not exclusive;




     (iv) “including” means including without limitation;




     (v) words in the singular include the plural and words in the plural
include the singular;



     (vi) any pronouns shall be deemed to cover all genders; and



     (vii) any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection
herewith means such agreement, instrument or statute as from time to time
amended, modified, waived or supplemented and includes (in the case of
agreements or instruments) references to all attachments thereto and
instruments incorporated therein; references to a Person are also to its
permitted successors and assigns.



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ARTICLE II




THE NOTES




     Section 2.01 Form.



     The Notes, together with the Indenture Trustee’s certificate of
authentication, shall be in substantially the forms set forth as Exhibits
A–1, A–2, A–3, A–4 and A-5 to this Indenture
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture and may have such letters,
numbers or other marks of identification and such legends or endorsements
placed thereon as may, consistently herewith, be determined by the appropriate
Authorized Officers executing such Notes, as evidenced by their execution of
the Notes. Any portion of the text of any Note may be set forth on the reverse
thereof, with an appropriate reference thereto on the face of the Note.



     The Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of these methods (with or without steel engraved
borders), all as determined by the Authorized Officers executing such Notes, as
evidenced by their execution of such Notes.



     The terms of the Notes set forth in Exhibits A-1, A-2,
A-3, A-4, A-5 and A-6 are part of the terms of this
Indenture.



     Section 2.02 Execution, Authentication and Delivery.



     The Notes shall be executed on behalf of the Issuer by any of its
Authorized Officers. The signature of any such Authorized Officer on the Notes
may be manual or facsimile.



     Notes bearing the manual or facsimile signature of individuals who were at
any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.



     The Indenture Trustee shall upon receipt of an Issuer Order authenticate
and deliver Class A-1 Notes for original issue in an aggregate amount equal to
the Initial Class A-1 Principal Balance, Class A-2 Notes for original issue in
an aggregate amount equal to the Initial Class A-2 Principal Balance, Class B
Notes for original issue in an aggregate amount equal to the Initial Class B
Principal Balance, Class C Notes for original issue in an aggregate amount
equal to the Initial Class C Principal Balance, Class D Notes for original
issue in an aggregate amount equal
to the Initial Class D Principal Balance and a Class E Note for original
issue in an aggregate amount equal to the Initial Class E Principal Balance.



     Each Note shall be dated the date of its authentication. The Notes shall
be issuable as registered Notes in the minimum initial denominations of
$500,000 and in integral multiples of $1,000 in excess thereof;
provided, however, that one Note of each Class may be issued in a
different denomination.



     No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication substantially in the



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form provided for herein executed by the
Indenture Trustee by the manual signature of one of its authorized signatories,
and such certificate upon any Note shall be conclusive evidence, and the only
evidence, that such Note has been duly authenticated and delivered hereunder.



     Section 2.03 Opinions of Counsel.



     On the Closing Date, the Indenture Trustee shall have received: (i) an
Opinion of Counsel, with respect to securities law matters; (ii) an Opinion of
Counsel, with respect to the tax status of the arrangement created by this
Indenture and the tax treatment of the Class A-1 Notes, the Class A-2 Notes,
the Class B Notes, the Class C Notes and the Class D Notes; and (iii) an
Opinion of Counsel to the Issuer, with respect to the due authorization, valid
execution and delivery of this Indenture and with respect to its binding effect
on the Issuer.



ARTICLE III




COVENANTS




     Section 3.01 Collection of Payments on Loans; Trust Accounts.



     The Servicer shall establish with the Indenture Trustee and cause to be
maintained each of the Trust Accounts specified in Section 7.01 of the
Sale and Servicing Agreement. The Indenture Trustee shall ensure that each of
the Trust Accounts is established and maintained as an Eligible Deposit Account
with a Qualified Institution. If any institution with which any of the Trust
Accounts established pursuant to subsection 7.01(a) of the Sale and
Servicing Agreement are established ceases to be a Qualified Institution, the
Servicer, or if the Servicer fails to do so, the Indenture Trustee (as the case
may be) shall within 10 Business Days establish a replacement account at a
Qualified Institution after notice of such event. The Indenture Trustee shall
make all payments of principal of and interest on the Notes, subject to
Section 3.03 and as provided in Section 3.05 herein from moneys
on deposit in the Note Distribution Account.



     Section 3.02 Maintenance of Office or Agency.



     The Issuer will maintain with the Indenture Trustee an office or agency
where, subject to satisfaction of conditions set forth herein, Notes may be
surrendered for registration of transfer or exchange, and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Issuer hereby initially appoints the Indenture Trustee to serve as
its agent for the foregoing purposes. The Issuer will give prompt written
notice to the
Indenture Trustee of the location, and of any change in the location, of
any such office or agency. If at any time the Issuer shall fail to maintain
any such office or agency or shall fail to furnish the Indenture Trustee with
the address thereof, such surrenders, notices and demands may be made or served
at the Corporate Trust Office of the Indenture Trustee, and the Issuer hereby
appoints the Indenture Trustee as its agent to receive all such surrenders,
notices and demands.



     Section 3.03 Money for Payments To Be Held in Trust; Paying Agent.



     The Issuer hereby appoints the Indenture Trustee as Paying Agent for the
payment of principal and interest on the Notes. As provided in Section
3.01, all payments of amounts due and payable with respect to any Notes or
Hedge Agreements that are to be made from amounts



10









 





withdrawn from the Note
Distribution Account pursuant to Section 3.01 shall be made on behalf of
the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts
so withdrawn from the Note Distribution Account for payments of Notes or any
Hedge Agreements shall be paid over to the Issuer except as provided in this
Section 3.03. The Issuer shall have for so long as any Notes are listed
on the Irish Stock Exchange, a Paying Agent for the payment of principal and
interest on such Notes in Ireland and where notices and demands to or upon the
Issuer in respect of such Notes or this Indenture may be served and where such
securities may be surrendered for registration of transfer or exchange. The
Issuer hereby appoints JP Morgan Bank (Ireland) PLC as Paying Agent for the
payment of principal and interest with respect to only those securities listed
on the Irish Stock Exchange.



     The Issuer may at any time and from time to time vary or terminate the
appointment of any such agent or appoint any additional agents for any or all
of such purposes; provided, that, (A) no Paying Agent shall be
appointed in a jurisdiction that subjects payments on the Notes to withholding
tax and (B) so long as any Notes are listed on the Irish Stock Exchange and the
rules of such exchange so require, the Issuer will maintain in Ireland a Paying
Agent and an office or agency where notices and demands to or upon the Issuer
in respect of such securities and this Indenture may be served and where such
Notes may be surrendered for registration of transfer or exchange. The Issuer
shall give prompt written notice to the Indenture Trustee, the Rating Agencies
and the Noteholders of the appointment or termination of any such agent and of
the location and any change in the location of any such office or agency.



     On or before the Business Day immediately preceding each Remittance Date
and the Redemption Date, the Issuer shall deposit or cause to be deposited in
the Note Distribution Account an aggregate sum sufficient to pay the amounts
then becoming due, such sum to be held in trust for the benefit of the Persons
entitled thereto and (unless the Paying Agent is the Indenture Trustee) shall
promptly notify the Indenture Trustee in writing of its action or failure so to
act.



     The Issuer will cause each Paying Agent other than the Indenture Trustee
to execute and deliver to the Indenture Trustee an instrument in which such
Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions
of this Section 3.03, that such Paying Agent will:




     (i) hold all sums held by it for the payment of amounts due with
respect to the Notes or the Hedge Agreements in trust for the benefit of
the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and pay such sums to
such Persons as herein provided;




     (ii) give the Indenture Trustee notice of any default by the Issuer
in the making of any payment required to be made with respect to the
Notes or the Hedge Agreements;




     (iii) at any time during the continuance of any such default, upon
the written request of the Indenture Trustee, forthwith pay to the
Indenture Trustee all sums so held in trust by such Paying Agent;



11









 






     (iv) immediately resign as Paying Agent and forthwith pay to the
Indenture Trustee all sums held by it in trust for the payment of Notes
or the Hedge Agreements if at any time it ceases to meet the standards
required to be met by a Paying Agent at the time of its appointment; and




     (v) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes or the Hedge
Agreements of any applicable withholding taxes imposed thereon and with
respect to any applicable reporting requirements in connection therewith.



     The Issuer may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, by Issuer Order
direct any Paying Agent to pay to the Indenture Trustee all sums held in trust
by such Paying Agent, such sums to be held by the Indenture Trustee upon the
same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.



     Subject to applicable laws with respect to escheat of funds, any money
held by the Indenture Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Note and remaining unclaimed for two years
after such amount has become due and payable shall be discharged from such
trust and be paid to the Issuer on an Issuer Order; and the Holder of such Note
shall thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided,
however, that
the Indenture Trustee or such Paying Agent, before being required to make any
such repayment, shall at the expense and direction of the Issuer cause to be
published once, in an Authorized Newspaper, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less
than 30 days from the date of such publication, any unclaimed balance of such
money then remaining will be repaid to the Issuer. The Indenture Trustee shall
also adopt and employ, at the expense and direction of the Issuer, any other
reasonable means of notification of such repayment (including, but not limited
to, mailing notice of such repayment to Holders whose Notes have been called
but have not been surrendered for redemption or whose right to or interest in
moneys due and payable but
not claimed is determinable from the records of the Indenture Trustee or
of any Paying Agent, at the last address of record for each such Holder).



     Section 3.04 Existence.



     The Issuer will keep in full effect its existence, rights and franchises
as a statutory trust under the laws of the State of Delaware (unless it
becomes, or any successor Issuer hereunder is or becomes, organized under the
laws of any other state or of the United States, in which case the Issuer will
keep in full effect its existence, rights and franchises under the laws of such
other jurisdiction) and will obtain and preserve its qualification to do
business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Indenture, the
Notes, the Hedge Agreements, the other Transaction Documents, the Indenture
Collateral and each other instrument or agreement included in the Indenture
Collateral.



12









 





     Section 3.05 Payment of Principal and Interest.



     The Issuer will duly and punctually pay (i) the principal of and interest
on the Notes in accordance with the terms of such Notes, this Indenture and the
Sale and Servicing Agreement and (ii) all amounts payable under the Hedge
Agreements in accordance with the terms thereof. The Issuer will cause to be
distributed all amounts on deposit in the Note Distribution Account on a
Remittance Date deposited therein pursuant to the Sale and Servicing Agreement
for the benefit of the Notes, to the applicable Noteholders, and for the
benefit of the Hedge Agreements, to the applicable Hedge Counterparties.
Amounts properly withheld under the Code or any applicable state law by any
Person from a payment to any Noteholder of interest and/or principal shall be
considered as having been paid by the Issuer to such Noteholder for all
purposes of this Indenture.



     Section 3.06 Protection of Indenture Collateral.



     (a) The Issuer intends the security interest Granted pursuant to this
Indenture in favor of the Indenture Trustee on behalf of the Noteholders and
the Hedge Counterparties to be prior to all other liens in respect of the
Indenture Collateral, and the Issuer shall take or shall cause the Servicer to
take all actions necessary to obtain and maintain, for the benefit of the
Indenture Trustee on behalf of the Noteholders and the Hedge Counterparties, a
first lien on and a first priority, perfected security interest in the
Indenture Collateral. In connection therewith, pursuant to Section 2.06
of the Sale and Servicing Agreement, the Issuer shall cause to be delivered
into the possession of the Indenture Trustee as pledgee hereunder, indorsed in
blank, any “instruments” (within the meaning of the UCC), not constituting part
of chattel paper, evidencing any Loan which is part of the Indenture Collateral
and all other portions of the Loan Files. The Indenture Trustee acknowledges
and agrees that (i) it holds the Loan Assets delivered to it under the Sale
Agreement for the benefit of the Trust Depositor, (ii) it holds the Loan Assets
delivered to it under the Sale and Servicing Agreement for the benefit of the
Trust, and (iii) it holds the Indenture Collateral delivered to it pursuant to
this Indenture for the benefit of the Noteholders and the Hedge Counterparties.
The Indenture Trustee agrees to maintain continuous possession of such
delivered instruments and the Loan Files as pledgee hereunder until this
Indenture shall have terminated in accordance with its terms or until, pursuant
to the terms hereof or of the Sale and Servicing Agreement, the Indenture
Trustee is otherwise authorized to release
such instrument from the Indenture Collateral. The Servicer, on behalf of
the Issuer, will from time to time prepare (or shall cause to be prepared),
execute and deliver all such supplements and amendments hereto and all such
financing statements, continuation statements, instruments of further assurance
and other instruments, and will take such other action necessary or advisable
to:




     (i) maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the
purposes hereof;




     (ii) perfect, publish notice of or protect the validity of any Grant
made or to be made by this Indenture;




     (iii) enforce any of the Loans transferred to the Issuer as and to
the extent commercially reasonable; or



13









 






     (iv) preserve and defend title to the Indenture Collateral and the
rights of the Indenture Trustee, the Noteholders and the Hedge
Counterparties in such Indenture Collateral against the claims of all
persons and parties.



     (b) Except as otherwise provided in or permitted by the Sale and Servicing
Agreement or this Indenture, the Indenture Trustee shall not remove any portion
of the Indenture Collateral that consists of money or is evidenced by an
instrument, certificate or other writing from the jurisdiction in which it was
held at the date of the most recent Opinion of Counsel delivered pursuant to
Section 3.07 (or from the jurisdiction in which it was held as described
in the Opinion of Counsel delivered at the Closing Date pursuant to
subsection 3.07(a), if no Opinion of Counsel has yet been delivered
pursuant to subsection 3.07(b)) unless the Indenture Trustee shall have
first received an Opinion of Counsel to the effect that the lien and security
interest created by this Indenture with respect to such property will continue
to be maintained after giving effect to such action or actions.



     The Issuer hereby designates the Indenture Trustee its agent and
attorney–in–fact to execute any financing statement, continuation statement or
other instrument required to be executed pursuant to this Section 3.06.



     Section 3.07 Opinions as to Indenture Collateral.



     (a) On or before the Closing Date, the Issuer shall furnish to the
Indenture Trustee and Hedge Counterparties an Opinion of Counsel either stating
that, in the opinion of such counsel, such action has been taken with respect
to the delivery of the Underlying Notes (or, in the case of Noteless Loans, a
copy of the applicable Loan Register certified by a Responsible Officer of the
Servicer) and any other requisite documents, and with respect to the execution
and filing of any financing statements and continuation statements, as are
necessary to perfect and make effective the lien and security interest of this
Indenture and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to make such lien and
security interest effective.



     (b) On or before December 31 in each calendar year, beginning in 2004, the
Servicer on behalf of the Issuer will furnish to the Indenture Trustee and
Hedge Counterparties an
Opinion of Counsel at the expense of the Issuer either stating that, in
the opinion of such counsel, such action has been taken with respect to any
other requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as is necessary to maintain
the perfection of the lien and security interest created by this Indenture and
reciting the details of such action or stating that in the opinion of such
counsel no such action is necessary to maintain the perfection of such lien and
security interest. Such Opinion of Counsel shall also describe any other
requisite documents and the execution and filing of any financing statements
and continuation statements that will, in the opinion of such counsel, be
required to maintain the lien and security interest of this Indenture until
December 31 in the following calendar year.



     Section 3.08 Furnishing of Rule 144A Information.



     The Issuer will furnish, upon the written request of any Noteholder or of
any owner of a beneficial interest therein, such information as is specified in
paragraph (d)(4) of Rule 144A



14









 





under the Securities Act (i) to such Noteholder
or beneficial owner, (ii) to a prospective purchaser of such Note or interest
therein who is a Qualified Institutional Buyer designated by such Noteholder or
beneficial owner, or (iii) to the Indenture Trustee for delivery to such
Noteholder, beneficial owner or prospective purchaser, in order to permit
compliance by such Noteholder or beneficial owner with Rule 144A in connection
with the resale of such Note or beneficial interest therein by such Noteholder
or beneficial owner in reliance on Rule 144A unless, at the time of such
request, the Issuer is subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act, or exempt from reporting pursuant to Rule 12g3-2(b)
under the Exchange Act.



     Section 3.09 Performance of Obligations; Sale and Servicing
Agreement.



     (a) The Issuer will punctually perform and observe all of its obligations
and agreements contained in this Indenture, the Transaction Documents and in
the instruments and agreements included in the Indenture Collateral.



     (b) The Issuer may contract with other Persons to assist it in performing
its duties under this Indenture, the Transaction Documents and in the
instruments and agreements included in the Indenture Collateral, and any
performance of such duties by a Person identified to the Indenture Trustee in
an Officer’s Certificate of the Issuer shall be deemed to be action taken by
the Issuer. Initially, the Issuer has contracted with the Servicer to assist
the Issuer in performing its duties under this Indenture, the Transaction
Documents and in the instruments and agreements included in the Indenture
Collateral.



     (c) The Issuer will not take any action or permit any action to be taken
by others which would release any Person from any of such Person’s covenants or
obligations under any of the documents relating to the Loans or under any
instrument included in the Indenture Collateral, or which would result in the
amendment, hypothecation, subordination, termination or discharge of, or impair
the validity or effectiveness of, any of the documents relating to the Loans or
any such instrument, except such actions as the Servicer is expressly permitted
to take in the Transaction Documents.



     (d) If the Issuer shall have knowledge of the occurrence of a Servicer
Default, the Issuer shall promptly notify in writing the Indenture Trustee,
each Hedge Counterparty and the Rating Agencies thereof, and shall specify in
such notice the action, if any, the Issuer is taking in respect of such
Servicer Default. If such Servicer Default arises from the failure of the
Servicer to perform any of its duties or obligations under the Sale and
Servicing Agreement with respect to the Loans, the Issuer may remedy such
failure. So long as any such Servicer Default shall be continuing, the
Indenture Trustee may exercise its remedies set forth in Section 8.02 of
the Sale and Servicing Agreement. Unless granted or permitted by the Holders
of the Notes and the Hedge Counterparties to the extent provided above, the
Issuer may not waive any such Servicer Default or terminate the rights and
powers of the Servicer under the Sale and Servicing Agreement.



     Section 3.10 Negative Covenants.



     So long as any Notes are Outstanding, the Issuer shall not:



15









 






     (i) except as expressly permitted by this Indenture or any other
Transaction Document, sell, transfer, exchange or otherwise dispose of
the Indenture Collateral, unless directed to do so by the Indenture
Trustee;




     (ii) claim any credit on, or make any deduction from the principal
or interest payable in respect of, the Notes (other than amounts properly
withheld from such payments under the Code or applicable state law) or
assert any claim against any present or former Noteholder or Hedge
Counterparty by reason of the payment of the taxes levied or assessed
upon any part of the Indenture Collateral;




     (iii) permit the validity or effectiveness of this Indenture to be
impaired, or permit the lien of this Indenture to be amended,
hypothecated, subordinated, terminated or discharged, or permit any
Person to be released from any covenants or obligations with respect to
the Notes or Hedge Agreements under this Indenture except as may be
expressly permitted hereby, permit any lien, charge, excise, claim,
security interest, mortgage or other encumbrance (other than the lien of
this Indenture or any other Transaction Document) to be created on or
extend to or otherwise arise upon or burden the Indenture Collateral or
any part thereof or any interest therein or the proceeds thereof or
permit the lien of this Indenture not to constitute a valid first
priority security interest in the Indenture Collateral; or




     (iv) except as contemplated in the Transaction Documents, dissolve
or liquidate in whole or in part.



     Section 3.11 Annual Statement as to Compliance.



     The Issuer will deliver to the Indenture Trustee, the Hedge Counterparties
and the Rating Agencies, within 90 days after the end of each calendar year
(commencing with the calendar year ending 2004), an Officer’s Certificate
stating, as to the Person signing such Officer’s Certificate, that:




     (i) a review of the activities of the Issuer during such year and of
its performance under this Indenture has been made under such Person’s
supervision or direction; and




     (ii) to the best of such Person’s knowledge, based on such review,
the Issuer has complied with all conditions and covenants under this
Indenture throughout such year, or, if there has been such a default in
its compliance with any such condition or covenant, specifying each such
default known to such Person and the nature and status thereof.



     Section 3.12 Recording of Assignments.



     The Issuer shall submit or cause to be submitted for recording all
Assignments of Mortgages within the time period set forth in the Sale and
Servicing Agreement.



16









 





     Section 3.13 Representations and Warranties Concerning the Loans.



     The Issuer has pledged to the Indenture Trustee for the benefit of the
Noteholders and the Hedge Counterparties all of its rights under the Sale
Agreement and the Sale and Servicing Agreement and the Indenture Trustee has
the benefit of the representations and warranties made by the Originator and
the Trust Depositor in such documents concerning the Loans transferred into the
Loan Assets and the right to enforce any remedy against the Originator and the
Trust Depositor provided in the Sale Agreement and the Sale and Servicing
Agreement, to the same extent as though such representations and warranties
were made directly to the Indenture Trustee.



     Section 3.14 Indenture Trustee’s Review of Loan Files.



     The Indenture Trustee agrees, for the benefit of the Noteholders and the
Hedge Counterparties, to review the Loan Files as provided in Section
2.08 of the Sale and Servicing Agreement.



     Section 3.15 Indenture Collateral; Related Documents.



     (a) When instructed to do so by the Issuer or the Servicer, the Indenture
Trustee shall execute instruments to release property from the lien of this
Indenture, or convey the Indenture Trustee’s interest in the same, in a manner
and under circumstances which are not inconsistent with the provisions of this
Indenture or the Sale and Servicing Agreement. No party relying upon an
instrument executed by the Indenture Trustee as provided in this Article
III shall be bound to ascertain the Indenture Trustee’s authority, inquire
into the satisfaction of any conditions precedent or see to the application of
any moneys.



     (b) In order to facilitate the servicing of the Loans, the Indenture
Trustee authorizes the Servicer in the name and on behalf of the Indenture
Trustee and the Issuer, to perform its respective duties and obligations under
the Sale and Servicing Agreement and the Indenture Trustee agrees to perform
its obligations thereunder in accordance with the terms thereof.



     (c) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and after terminating of each Hedge Agreement and payment of all
amounts payable thereunder in connection with such termination, including Hedge
Breakage Costs, release all of the Indenture Collateral to the Issuer (other
than any cash held for the payment of the Notes or the Hedge Agreements
pursuant to Section 3.03 or 4.06), subject, however, to the
rights of the Indenture Trustee under Section 6.07.



     Section 3.16 Amendments to Sale and Servicing Agreement.



     The Indenture Trustee may enter into any amendment or supplement to the
Sale and Servicing Agreement only in accordance with Section 13.01 of
the Sale and Servicing Agreement. The Indenture Trustee may, in its reasonable
discretion, decline to enter into or consent to any such supplement or
amendment if its own rights, duties or immunities shall be adversely affected
in any material respect.



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     Section 3.17 Servicer as Agent and Bailee of Indenture Trustee.



     (a) Solely for purposes of perfection under Section 9–313 of the UCC or
other similar applicable law, rule or regulation of the state in which such
property is held by the Servicer, the Indenture Trustee hereby acknowledges
that the Servicer is acting as agent and bailee of the Indenture Trustee in
holding amounts on deposit in the Principal and Interest Accounts pursuant to
Section 7.01 of the Sale and Servicing Agreement, as well as its agent
and bailee in holding any documents released to the Servicer pursuant to the
Sale and Servicing Agreement, and any other items constituting a part of the
Indenture Collateral which from time to time come into the possession of the
Servicer. It is intended that, by the Servicer’s execution and delivery of the
Sale and Servicing Agreement, the Indenture Trustee, as a secured party, will
be deemed to have possession of such documents, such moneys and such other
items for purposes of Section 9–313 of the UCC of the state in which such
property is held by the Servicer.



     (b) Solely for purposes of perfection under Section 9–313 of the UCC or
other similar applicable law, rule or regulation of the state in which such
property is held by the Indenture Trustee, if the transfer of the Loans and the
other assets in the Indenture Collateral by the Trust Depositor to the Issuer

is deemed to be a loan, the Indenture Trustee hereby acknowledges it is acting
as agent and bailee of the Issuer in holding items constituting a part of the
Indenture Collateral which from time to time come into the possession of the
Indenture Trustee.



     Section 3.18 Investment Company Act.



     The Issuer shall not be required to register as an “investment company”
under the Investment Company Act of 1940, as amended (or any successor or
amendatory statute).



     Section 3.19 Issuer May Consolidate, etc., Only on Certain Terms.



     (a) The Issuer shall not consolidate or merge with or into any other
Person, unless:




     (i) the Person (if other than the Issuer) formed by or surviving
such consolidation or merger shall be a Person organized and existing
under the laws of the United States or any state or the District of
Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the
Indenture Trustee and each Hedge Counterparty, in form satisfactory to
the Indenture Trustee and the Hedge Counterparties, the due and punctual
payment of the principal of and interest on all Notes and all amounts
payable under the Hedge Agreements and the performance or observance of
every agreement and covenant of this Indenture, the Hedge Agreements, the
Trust Certificates and each other Transaction Document on the part of the
Issuer to be performed or observed, all as provided herein and therein;




     (ii) immediately after giving effect to such transaction, no Default
or Event of Default shall have occurred and be continuing;




     (iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction;



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     (iv) the Issuer shall have received an Opinion of Counsel (and shall
have delivered copies thereof to the Indenture Trustee and the Hedge
Counterparties) to the effect that such transaction will not have any
material adverse tax consequence to the Issuer, any Noteholder, any Hedge
Counterparty and any Certificateholder;




     (v) any action that is necessary to maintain the lien and security
interest created by this Indenture shall have been taken; and




     (vi) the Issuer shall have delivered to the Indenture Trustee and
each Hedge Counterparty an Officer’s Certificate and an Opinion of
Counsel each stating that such consolidation or merger and such
supplemental indenture comply with this Article III and that all
conditions precedent herein provided for relating to such transaction
have been complied with.



     (b) Except as otherwise permitted hereunder or under the Transaction
Documents, the Issuer shall not convey or transfer all or substantially all of
its properties or assets, including those included in the Indenture Collateral,
to any Person, unless:



     (i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer the conveyance or transfer of which
is hereby restricted shall be a United States citizen or a Person
organized and existing under the laws of the United States or any state,
expressly assumes, by an indenture supplemental hereto, executed and
delivered to the Indenture Trustee and each Hedge Counterparty, in form
and substance reasonably satisfactory to the Indenture Trustee and the
Hedge Counterparties, the due and punctual payment of the principal of
and interest on all Notes, the amounts payable under the Hedge Agreements
and each other Transaction Document, and the performance or observance of
every agreement and covenant of this Indenture and the Hedge Agreements
on the part of the Issuer to be performed or observed, all as provided
herein, expressly agrees by means of such supplemental indenture that all
right, title and interest so conveyed or transferred shall be subject and
subordinate to the rights of the Holders of the Notes and the Hedge
Counterparties, unless otherwise provided in such supplemental indenture,
expressly agrees to indemnify, defend and hold harmless the Issuer
against and from any loss, liability or expense arising under or related
to this Indenture and the Notes;



     (ii) immediately after giving effect to such transaction, no Default
or Event of Default shall have occurred and be continuing;



     (iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction;



     (iv) the Issuer shall have received an Opinion of Counsel (and shall
have delivered copies thereof to the Indenture Trustee and each Hedge
Counterparty) to the effect that such transaction will not have any
material adverse tax consequence to the Issuer, any Noteholder, any Hedge
Counterparty and any Certificateholder;



     (v) any action that is necessary to maintain the lien and security
interest created by this Indenture shall have been taken; and



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     (vi) the Issuer shall have delivered to the Indenture Trustee and
each Hedge Counterparty an Officer’s Certificate and an Opinion of
Counsel each stating that such conveyance or transfer and such
supplemental indenture comply with this Article III and that all
conditions precedent herein provided for relating to such transaction
have been complied with.



     Section 3.20 Successor or Transferee.



     (a) Upon any consolidation or merger of the Issuer in accordance with
subsection 3.19(a), the Person formed by or surviving such consolidation or
merger (if other than the Issuer) shall succeed to, and be substituted for, and
may exercise every right and power of, the Issuer under this Indenture with the
same effect as if such Person had been named as the Issuer herein.



     (b) Upon a conveyance or transfer of all or substantially all of the
assets and properties of the Issuer pursuant to subsection 3.19(b), the
Issuer will be released from every covenant and agreement of this Indenture to
be observed or performed on the part of the Issuer with respect to the Notes or
the Hedge Agreements immediately upon the delivery of written notice to the
Indenture Trustee stating that the Issuer is to be so released.



     Section 3.21 No Other Business.



     The Issuer shall not engage in any business other than financing,
purchasing, owning, selling, managing and enforcing the Loans in the manner
contemplated by this Indenture and the Transaction Documents, issuing the Notes
and the Trust Certificates and entering into and performing its obligations
under the Hedge Agreements and all activities incidental thereto.



     Section 3.22 No Borrowing.



     The Issuer shall not issue, incur, assume, guarantee or otherwise become
liable, directly or indirectly, for any indebtedness except for the Notes, the
Hedge Agreements and any other indebtedness permitted by the Transaction
Documents. The proceeds from the initial sale of the Notes and the Trust
Certificates shall be used exclusively to fund the Issuer’s purchase of the
Loans and other assets specified in the Sale and Servicing Agreement, to
fund the Reserve Fund and to pay the transactional expenses of the Issuer.



     Section 3.23 Guarantees, Loans, Advances and Other Liabilities.



     Except as contemplated by this Indenture or the other Transaction
Documents, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuring another’s payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any
stock, obligations, assets or securities of, or any other interest in, or make
any capital contribution to, any other Person.



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     Section 3.24 Capital Expenditures.



     The Issuer shall not make any expenditure (by long–term or operating lease
or otherwise) for capital assets (either realty or personalty).



     Section 3.25 Representations and Warranties of the Issuer.



     The Issuer represents and warrants as follows:



     (a) Power and Authority. It has full power, authority and legal
right to execute, deliver and perform its obligations as Issuer under this
Indenture and the Notes (the foregoing documents, the “Issuer
Documents”) and under each of the other Transaction Documents to which the
Issuer is a party.



     (b) Due Authorization and Binding Obligation. The execution and
delivery of the Issuer Documents and the Transaction Documents to which the
Issuer is a party, and the consummation of the transactions provided for
therein have been duly authorized by all necessary action on its part. Each of
the Issuer Documents and the other Transaction Documents to which the Issuer is
a party constitutes the legal, valid and binding obligation of the Issuer and
is enforceable in accordance with its terms, except as enforcement of such
terms may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors’ rights generally and by the availability of equitable
remedies.



     (c) No Conflict. The execution and delivery of the Issuer
Documents and the other Transaction Documents to which the Issuer is a party,
the performance of the transactions contemplated thereby and the fulfillment of
the terms thereof will not conflict with, result in any breach of any of the
materials terms and provisions of, or constitute (with or without notice or
lapse of time or both) a default under, any indenture, contract, agreement,
mortgage, deed of trust, or other instrument to which the Issuer is a party or
by which it or any of its property is bound.



     (d) No Violation. The execution and delivery of the Issuer
Documents and the other Transaction Documents to which the Issuer is a party,
the performance of the transactions contemplated thereby and the fulfillment of
the terms thereof will not conflict with or violate, in any material respect,
any Requirements of Law applicable to the Issuer.



     (e) All Consents Required. All approvals, authorizations,
consents, orders or other actions of any Person or any Governmental Authority
required in connection with the execution and delivery of the Issuer Documents
and the other Transaction Documents to which the Issuer is a party, the
performance of the transactions contemplated thereby and the fulfillment of the
terms thereof have been obtained.



     (f) No Proceedings. No litigation or administrative proceeding of
or before any court, tribunal or governmental body is currently pending, or to
the knowledge of the Issuer, threatened, against the Issuer or any of its
respective properties or with respect to the Issuer Documents or any other
Transaction Document to which the Issuer is a party that, if adversely
determined, would have a material adverse effect on the business, properties,
assets or condition



21









 





(financial or otherwise) of the Issuer or the transactions
contemplated by the Issuer Documents or any of the other Transaction Documents
to which the Issuer is a party.



     (g) Organization and Good Standing. The Issuer is a statutory
trust duly organized, validly existing and in good standing under the laws of
Delaware and has the requisite power to own its assets and to transact the
business in which it is currently engaged, and had at all relevant times, and
now has, all necessary power, authority and legal right to acquire, own and
pledge the Indenture Collateral.



     (h) 1940 Act. The Issuer is not an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.



     (i) Location. The Issuer is located (within the meaning of Article
9 of the UCC) in Delaware. The Issuer agrees that it will not change its
location (within the meaning of Article 9 of the UCC) without at least 30 days
prior written notice to the Originator, the Servicer, the Indenture Trustee and
the Rating Agencies.



     (j) Security Interest in Collateral.




     (i) This Indenture creates a valid, continuing and enforceable
security interest (as defined in the applicable UCC) in the Indenture
Collateral in favor of the Indenture Trustee, which security interest is
prior to all other Liens (except for Permitted Liens), and is enforceable
as such against creditors of and purchasers from the Issuer;




     (ii) such Indenture Collateral constitutes either a “general
intangible,” an “instrument,” an “account,” “investment property,” or
“chattel paper,” within the meaning of the applicable UCC;




     (iii) the Issuer owns and has good and marketable title to such
Indenture Collateral free and clear of any Lien (other than Permitted
Liens), claim or encumbrance of any Person;




     (iv) the Issuer has received all consents and approvals required by
the terms of the Indenture Collateral to the pledge of the Indenture
Collateral hereunder to the Indenture Trustee;




     (v) the Issuer has caused the filing of all appropriate financing
statements in the proper filing office in the appropriate jurisdictions
under Requirements of Law in order to perfect the security interest in
such Indenture Collateral granted to the Indenture Trustee under this
Indenture;




     (vi) other than the security interest granted by the Issuer pursuant
to this Indenture, the Issuer has not pledged, assigned, sold, granted a
security interest in or otherwise conveyed any of such Indenture
Collateral. The Issuer has not authorized the filing of and is not aware
of any financing statements against the Issuer that include a description
of collateral covering such Indenture Collateral other than any financing
statement (A) relating to the security interest granted by the Issuer
under this Indenture,



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or (B) that has been terminated. The Issuer is not
aware of the filing of any judgment or tax Lien filings against the
Issuer;


     (vii) all original executed copies of each Underlying Note that
constitute or evidence the Indenture Collateral have been delivered to
the Indenture Trustee;




     (viii) the Issuer has received a written acknowledgment from the
Indenture Trustee that the Indenture Trustee or its bailee is holding the
Underlying Notes that constitute or evidence the Indenture Collateral
solely on behalf of and for the benefit of the Securityholders and the
Hedge Counterparties; and




     (ix) none of the Underlying Notes that constitute or evidence the
Indenture Collateral has any marks or notations indicating that they have
been pledged, assigned or otherwise conveyed to any Person other than the
Issuer and the Indenture Trustee.



     The representations and warranties in subsection 3.25(j) shall
survive the termination of this Agreement and such representations and
warranties may not be waived by any party hereto.



     Section 3.26 Restricted Payments.



     The Issuer shall not, directly or indirectly, (i) pay any dividend or make
any distribution (by reduction of capital or otherwise), whether in cash,
property, securities or a combination thereof, to the Owner Trustee or any
owner of a beneficial interest in the Issuer or otherwise with respect to any
ownership or equity interest or security in or of the Issuer, (ii) redeem,
purchase, retire or otherwise acquire for value any such ownership or equity
interest or security or (iii) set aside or otherwise segregate any amounts for
any such purpose; provided, however, that the Issuer may make, or
cause to be made, (w) distributions to the Owner Trustee, the Trust Company and
the Certificateholders as contemplated by, and to the extent funds are
available for such purpose under the Trust Agreement and the Sale and Servicing
Agreement, (x) payment to the Servicer and/or Trust Depositor pursuant to the
terms of the Sale and Servicing Agreement or the other Transaction Documents
and (y) payments to the Indenture Trustee pursuant to terms of the Sale and
Servicing Agreement. The Issuer will not, directly or indirectly, make
payments to or distributions from the Note Distribution Account except in
accordance with this Indenture and the Transaction Documents.



     Section 3.27 Notice of Events of Default.



     The Issuer shall give the Indenture Trustee, each Hedge Counterparty and
the Rating Agencies prompt written notice of each Event of Default hereunder
and under the Trust Agreement and of each Servicer Default under the Sale and
Servicing Agreement.



     Section 3.28 Further Instruments and Acts.



     Upon request of the Indenture Trustee, the Issuer will execute and deliver
such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this
Indenture.



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     Section 3.29 Statements to Noteholders.



     The Indenture Trustee shall forward by mail to each Noteholder and each
Hedge Counterparty the statements delivered to it pursuant to Article IX
of the Sale and Servicing Agreement except for the Monthly Report. The
Indenture Trustee may make available to the Noteholders, the Hedge
Counterparties, the parties to the Transaction Documents and the Rating
Agencies, via the Indenture Trustee’s Internet website, each Monthly Report
and, with the consent or at the direction of the Trust Depositor, such other
information regarding the Notes and/or the Loans as the Indenture Trustee may
have in its possession, but only with the use of a password provided by the
Indenture Trustee, provided, however, the Indenture Trustee shall
have no obligation to provide such information described in this Section 3.29
until it has received the requisite information from the Trust Depositor or the
Servicer. The Indenture Trustee will make no representation or warranties as
to the accuracy or completeness of such documents and will assume no
responsibility therefor.



     The Indenture Trustee’s Internet website shall be initially located at
“www.CTSLink.com” or at such other address as shall be specified by the
Indenture Trustee from time to time in writing to the Noteholders, the Hedge
Counterparties, the parties to the Transaction Documents and the Rating
Agencies. In connection with providing access to the Indenture Trustee’s
Internet website, the Indenture Trustee may (other than with respect to the
parties to the Transaction Documents and the Rating Agencies) require
registration and the acceptance of a disclaimer. The Indenture Trustee shall
not be liable for the dissemination of information in accordance with this
Agreement.



     Section 3.30 Grant of Substitute Loans.



     In consideration of the delivery on each Subsequent Transfer Date pursuant
to and in accordance with the terms of Section 2.04 of the Sale and
Servicing Agreement, the Issuer grants to the Indenture Trustee a security
interest in all of its right, title and interest in the Loans transferred on
such Subsequent Transfer Date and simultaneously with the transfer of the
Substitute Loans to the extent of the availability thereof, the Issuer will
cause the related Loan File to be delivered to the Indenture Trustee.



     Section 3.31 Determination of LIBOR; Note Interest Rate; Interest
Distributable.



     Until the Outstanding Principal Balance of each Class of Notes has been
reduced to zero, the Indenture Trustee shall determine LIBOR for each Interest
Accrual Period as provided in Section 7.06 of the Sale and Servicing
Agreement, and based upon such determination of LIBOR, the Trustee shall
calculate the Class A-1 Note Interest Rate, the Class A-2 Note Interest Rate,
the Class B Note Interest Rate, the Class C Note Interest Rate and the Class D
Note Interest Rate for such Interest Accrual Period, and shall inform the
Issuer, the Trust Depositor and the Servicer at their respective email
addresses given to the Indenture Trustee in writing thereof. Any such
determination by the Indenture Trustee of the amount of interest distributable
on the Class A-1 Notes, the Class A-2 Notes, the Class B Notes, the Class C
Notes and the Class D Notes shall be binding on the parties absent manifest
error.



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     Section 3.32 Covenants of the Issuer Relating to Hedge Agreements.



     (a) On each day, the Issuer shall maintain one or more Hedge Transactions,
provided that each such Hedge Transaction shall:




     (i) be entered into with a Hedge Counterparty and governed by a
Hedge Agreement;




     (ii) have a schedule of periodic payment periods which terminate not
later than the date on which the Outstanding Amount of the Notes is
expected to be reduced to zero based on the contractual provisions of the
Loans as in effect from time to time;




     (iii) on the Closing Date, have an amortizing notional amount such
that the Aggregate Notional Amount during any current or future
calculation period thereunder shall be not less than the sum of (A) the
product of 100% and the Outstanding Loan Balance of the Fixed Rate Loans
for the corresponding Due Period; and (B) the product of 100% and the
Outstanding Loan Balance of the Floating Prime Rate Loans for the
corresponding Due Period, in each case, based on the contractual
provisions of the Loans as in effect on such date;




     (iv) be maintained so that (A) the Aggregate Notional Amount of all
Hedge Transactions hedging the Fixed Rate Loans for any current or future
calculation period will not be greater than nor less than the Outstanding
Loan Balance of the Fixed Rate Loans at the end of the corresponding Due
Period by more than the Fixed Rate Permitted Excess Amount, (B) the
Aggregate Notional Amount of all Hedge Transactions (excluding any
interest rate cap transactions) hedging the Floating Prime Rate Loans for
any current or future calculation period will not be greater than nor
less than the Outstanding Loan Balance of the Floating Prime Rate Loans
at the end of the corresponding Due Period by more than the Floating
Prime Rate Permitted Excess Amount and (C) the Aggregate Notional Amount
of all Hedge Transactions (excluding any interest rate cap transactions)
under all Hedge Agreements then in effect for any current or future
calculation period shall not exceed the Aggregate Outstanding Principal
Balance for the corresponding Interest Accrual Period; and




     (v) each Hedge Agreement will provide that any scheduled periodic
payments required to be made by the Issuer and the Hedge Counterparty on
the same date with respect to a Hedge Transaction will be netted so that
only the net difference between such payments will be paid, with any net
periodic payments to be paid into the Principal and Interest Account (if
payable by the Hedge Counterparty) or from the Principal and Interest
Account (if payable by the Issuer) and distributed pursuant to the terms
of this Indenture and the Sale and Servicing Agreement.



     (b) As additional security hereunder, the Issuer hereby assigns to the
Indenture Trustee, on behalf of the Noteholders and each Hedge Counterparty,
all right, title and interest of the Issuer in each Hedge Agreement, each Hedge
Transaction, and all present and future amounts payable by a Hedge Counterparty
to the Issuer in accordance with the terms of the respective Hedge Agreement
and Hedge Transaction(s) with that Hedge Counterparty (“Hedge
Collateral”),




25









 





and Grants a security interest to the Indenture Trustee, as
agent for the Noteholders and each Hedge Counterparty, in the Hedge Collateral.
The Issuer acknowledges that, as a result of that assignment, the Issuer may
not, without the prior written consent of the Indenture Trustee, exercise any
rights under any Hedge Agreement or Hedge Transaction, except for the Issuer’s
right under any Hedge Agreement to enter into Hedge Transactions in order to
meet the Issuer’s obligations under Section 3.32 hereof or except as
otherwise contemplated in this Section 3.32 and in subsection
5.02(g) of the Sale and Servicing Agreement. Nothing herein shall have the
effect of releasing the Issuer from any of its obligations under any Hedge
Agreement or any Hedge Transaction, nor be construed as requiring the consent
of the Indenture Trustee, any Noteholder or any Hedge Counterparty for the
performance by the Issuer of any such obligations.



     (c) The Issuer hereby agrees to maintain a register of outstanding Hedge
Agreements. Such register shall contain the name of each Hedge Counterparty as
well as the address of each Hedge Counterparty. The Issuer shall provide such
names and addresses to the Indenture Trustee, the Backup Servicer and each
Rating Agency on a current basis.



     (d) The Indenture Trustee shall, upon notice from the Issuer, establish a
single, segregated trust account which shall be designated as the Hedge
Counterparty Collateral Account, which shall be held in trust in the name of
the Indenture Trustee for the benefit of the Noteholders and the Hedge
Counterparties and over which the Trustee shall have the exclusive control and
the sole right of withdrawal. The Indenture Trustee shall deposit all
collateral received from a Hedge Counterparty under a Hedge Agreement in the
Hedge Counterparty Collateral Account. Any and all funds at any time on
deposit in, or otherwise to the credit of, the Hedge Counterparty Collateral
Account shall be held in trust by the Indenture Trustee for the benefit of the
Noteholders and the Hedge Counterparties. The only permitted withdrawal from
or application of funds on deposit in, or otherwise to the credit of, the Hedge
Counterparty Collateral Account shall be upon Issuer Order (i) for application
to obligations of a Hedge Counterparty to the Issuer under Hedge Agreement if
such Hedge Agreement becomes subject to early termination or (ii) to return
collateral to such Hedge Counterparty when and as required by such Hedge
Agreement. The Trustee shall be fully protected in relying upon such Issuer
Order. Each Hedge Counterparty Collateral Account shall be held in accordance
with the terms of the related Hedge Agreement.



     (e) Each Hedge Agreement will provide that if at any time the Hedge
Counterparty or the Hedge Counterparty’s credit support provider does not have
the long-term or short-term ratings required to be a Qualified Hedge
Counterparty then (A) the Hedge Counterparty shall either post collateral
within 30 days as provided in the Credit Support Annex to the Hedge Agreement
or (B) transfer (at its own cost) all of its rights and obligations under the
Hedge Agreement to another Person in accordance with the terms of the Hedge
Agreement; provided, however, that notwithstanding the foregoing,
if the Hedge Counterparty has a long-term senior unsecured debt rating by
Moody’s of below “A3” or “A3” on watch or a short-term debt rating by Moody’s
of below “P-1” (for so long as the Class A-1 Notes, the Class A-2 Notes, the
Class B Notes, the Class C Notes or the Class D Notes are deemed Outstanding
hereunder and are rated by Moody’s), the Hedge Counterparty shall transfer (at
its own cost) all of its rights and obligations under the Hedge Agreements to
another Person in accordance with the terms of this Agreement.



26









 





     Section 3.33 Payments from Obligor Lock–Boxes and Obligor Lock–Box Accounts.



     The Issuer agrees not to make, or permit to be made, any change, in the
direction of, or instructions with respect to, any payments to be made by an
Obligor Lock–Box Bank from any Obligor Lock–Box or any Obligor Lock–Box Account
in any manner that would diminish, impair, delay or otherwise adversely effect
the timing or receipt of such payments by the Lock–Box Bank or to change the
name in which an Obligor Lock-Box or Obligor Lock-Box Account is maintained
without the prior written consent of the Indenture Trustee and with the consent
of the Majority Noteholders and the Hedge Counterparties. The Issuer further
agrees to provide the Indenture Trustee promptly, but in no case later than one
(1) Business Day after the Issuer’s receipt, any notice it receives that an
Obligor is changing the direction of or instructions with respect to any
payments from any Obligor Lock–Box or any Obligor Lock–Box Account or the name
in which an Obligor Lock-Box or Obligor Lock-Box Account is maintained.



     Section 3.34 Maintenance of Listing.



     So long as any of the Class A-1 Notes, the Class A-2 Notes, the Class B
Notes, the Class C Notes or the Class D Notes remain Outstanding, the Issuer
shall use all commercially reasonable efforts to maintain the listing of such
Class A-1 Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes and
the Class D Notes on the Irish Stock Exchange. If, despite such efforts, such
listing cannot be maintained, the Issuer shall instead use reasonable efforts
to promptly obtain and thereafter maintain a listing of such Class A-1 Notes,
the Class A-2 Notes, the Class B Notes, the Class C Notes or the Class D Notes
on any other stock exchange located within a member country of the European
Union.



ARTICLE IV




THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE




     Section 4.01 The Notes.




     Certain of the Class A-1 Notes, the Class A-2 Notes, the Class B Notes,
the Class C Notes and the Class D Notes shall be registered initially in the
name of Cede & Co. Beneficial Owners will hold interests in the Class A-1
Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes and the Class
D Notes through the book–entry facilities of the Depository in minimum
denominations of $500,000 and integral multiples of $1,000 in excess thereof.
Subject to subsections 4.02(b), (p), (q) and (r),
the Class A-1 Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes,
the Class D Notes and the Class E Note shall be issued in such names and
denominations as may be set forth on an Issuer Order delivered to the Indenture
Trustee.



     The Notes shall, on original issue, be executed on behalf of the Issuer by
the Owner Trustee, not in its individual capacity but solely as Owner Trustee,
authenticated by the Note Registrar and delivered by the Indenture Trustee to
or upon the order of the Issuer.



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     Section 4.02 Registration of Transfer and Exchange of Notes.



     (a) The Indenture Trustee shall cause to be kept a Note Register (the
“Note Register”) in which, subject to such reasonable regulations as it
may prescribe, the Issuer shall provide for the registration of Notes and the
registration of transfers and exchanges of Notes as herein provided. The
Indenture Trustee shall be “Note Registrar” for the purpose of
registering Notes and transfers of Notes as herein provided. The Note Register
shall contain the name, remittance instructions, Class of each Noteholder, as
well as the Series and the number in the Series.



     (b) Each Class of Notes shall be issued in minimum denominations of
$500,000 initial principal amount and integral multiples of $1,000 in excess
thereof, except that one Note of each Class may be in a different denomination
so that the sum of the denominations of all outstanding Notes of such Class
shall equal the applicable Initial Class A-1 Principal Balance, the Initial
Class A-2 Principal Balance, the Initial Class B Principal Balance, the Initial
Class C Principal Balance, the Initial Class D Principal Balance and the
Initial Class E Principal Balance, respectively. On the Closing Date, the
Indenture Trustee will execute and authenticate (i) one or more Global Notes
and/or (ii) Individual Notes all in an aggregate principal amount that shall
equal the applicable Initial Class A-1 Principal Balance, the applicable
Initial Class A-2 Principal Balance, the applicable Initial Class B Principal
Balance, the applicable Initial Class C Principal Balance, the applicable
Initial Class D Principal Balance and the applicable Initial Class E Principal
Balance.



     (c) The Global Notes (i) shall be delivered by the Issuer to the
Depository or, pursuant to the Depository’s instructions, shall be delivered by
the Issuer on behalf of the Depository to and deposited with the DTC Custodian,
and in each case shall be registered in the
name of Cede & Co. and (ii) with respect to the Rule 144A Global Notes,
shall bear a legend substantially to the following effect:




“Unless this Note is presented by an authorized representative of
The Depository Trust Company, a New York corporation
(“DTC”), to the Note Registrar or its agent for registration
of transfer, exchange or payment, and any Note issued is registered
in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as
the registered owner hereof, Cede & Co., has an interest herein.”



     The Global Notes may be deposited with such other Depository as the Issuer
may from time to time designate, and shall bear such legend as may be
appropriate; provided, that, such successor Depository maintains
a book–entry system that qualifies to be treated as “registered form” under
Section 163(f)(3) of the Code.



     The Issuer and the Indenture Trustee are hereby authorized to execute and
deliver a Letter of Representations with the Depository relating to the Notes.



28









 





     (d) With respect to Notes registered in the Note Register in the name of
Cede & Co., as nominee of the Depository, the Issuer, the Servicer, the Owner
Trustee (as such and in its individual capacity) and the Indenture Trustee
shall have no responsibility or obligation to Direct or Indirect Participants
or Beneficial Owners for which the Depository holds Notes from time to time as
a Depository. Without limiting the immediately preceding sentence, the Issuer,
the Servicer, the Owner Trustee, (as such and in its individual capacity), and
the Indenture Trustee shall have no responsibility or obligation with respect
to (a) the accuracy of the records of the Depository, Cede & Co., or any Direct
or Indirect Participant with respect to the ownership interest in the Notes,
(b) the delivery to any Direct or Indirect Participant or any other Person,
other than a registered Holder of a Note, (c) the payment to any Direct or
Indirect Participant or any other Person, other than a registered Holder of a
Note as shown in the Note Register, of any amount with respect to any
distribution of principal or interest on the Notes or (d) the making of
book–entry transfers among Participants of the Depository with respect to Notes
registered in the Note Register in the name of the nominee of the Depository.
No Person other than a registered Holder of a Note as shown in the Note
Register shall receive a Note evidencing such Note.



     (e) Upon delivery by the Depository to the Indenture Trustee of written
notice to the effect that the Depository has determined to substitute a new
nominee in place of Cede & Co., and subject to the provisions hereof with
respect to the payment of distributions by the mailing of checks or drafts to
the registered Holders of Notes appearing as registered Owners in the Note
Register on a Record Date, the name “Cede & Co.” in this Indenture shall refer
to such new nominee of the Depository.



     (f) In the event that (i) the Depository or the Servicer advises the
Indenture Trustee in writing that the Depository is no longer willing or able
to discharge properly its responsibilities as nominee and depository with
respect to the Global Notes and the Servicer is unable to locate a
qualified successor or (ii) the Servicer at its sole option elects to
terminate the book–entry system through the Depository, the Global Notes shall
no longer be restricted to being registered in the Note Register in the name of
Cede & Co. (or a successor nominee) as nominee of the Depository. At that
time, the Servicer may determine that the Global Notes shall be registered in
the name of and deposited with a successor depository operating a global
book–entry system, as may be acceptable to the Servicer, or such depository’s
agent or designee but, if the Servicer does not select such alternative global
book–entry system, then upon surrender to the Note Registrar of the Global
Notes by the Depository, accompanied by the registration instructions from the
Depository for registration, the Indenture Trustee shall at the Servicer’s
expense authenticate Individual Notes. Neither the Servicer nor the Indenture
Trustee shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Individual Notes, the Indenture Trustee, the Note
Registrar, the Servicer, any Paying Agent and the Issuer shall recognize the
Holders of the Individual Notes as Noteholders hereunder.



     (g) Notwithstanding any other provision of this Agreement to the contrary,
so long as any Global Notes are registered in the name of Cede & Co., as
nominee of the Depository, all distributions of principal and interest on such
Global Notes and all notices with respect to such Global Notes shall be made
and given, respectively, in the manner provided in the Letter of
Representations.



29









 





     (h) Subject to the preceding paragraphs, upon surrender for registration
of transfer of any Note at the office of the Note Registrar and, upon
satisfaction of the conditions set forth below, the Issuer shall execute in the
name of the designated transferee or transferees, a new Note or Notes of the
same Percentage Interest and dated the date of authentication by the Indenture
Trustee. The Note Registrar shall notify the Servicer and the Indenture
Trustee of any such transfer.



     (i) At the option of the Noteholders, Notes may be exchanged for other
Notes in authorized denominations of a like Class, upon surrender of the Notes
to be exchanged at such office. Whenever any Notes are so surrendered for
exchange, the Issuer shall execute the Notes which the Noteholder making the
exchange is entitled to receive. Every Note presented or surrendered for
transfer or exchange shall be accompanied by wiring instructions, if
applicable, in the form of Exhibit C. The preceding provisions of this
section notwithstanding, the Issuer shall not be required to make and the Note
Registrar shall not register transfers or exchanges of Notes called for
redemption.



     (j) No service charge shall be made for any transfer or exchange of Notes,
but prior to transfer the Note Registrar may require payment by the transferor
of a sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any transfer or exchange of Notes.



     All Notes surrendered for payment, transfer and exchange or redemption
shall be marked canceled by the Note Registrar and retained for one year and
destroyed thereafter.



     (k) By acceptance of an Individual Note, whether upon original issuance or
subsequent transfer, each holder of such a Note acknowledges the restrictions
on the transfer of
such Note set forth in the Securities Legend and agrees that it will
transfer such a Note only as provided herein. In addition to the provisions of
subsection 4.02(n) the following restrictions shall apply with respect
to the transfer and registration of transfer of an Individual Note to a
transferee that takes delivery in the form of an Individual Note:




     (i) The Note Registrar shall register the transfer of an Individual
Note if the requested transfer is being made to a transferee who has
provided the Note Registrar with a Rule 144A Certification; or




     (ii) The Note Registrar shall register the transfer of any
Individual Note if (x) the transferor has advised the Note Registrar in
writing that the Note is being transferred to a Person that is both an
Institutional Accredited Investor and a Qualified Purchaser; and (y)
prior to the transfer the transferee furnishes to the Note Registrar a
Transferee Letter; provided, that, if based upon an Opinion
of Counsel to the effect that the delivery of (x) and (y) above are not
sufficient to confirm that the proposed transfer is being made pursuant
to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and other applicable
laws, the Note Registrar may as a condition of the registration of any
such transfer require the transferor to furnish other certifications,
legal opinions or other information prior to registering the transfer of
an Individual Note.



30









 





     (l) Subject to subsection 4.02(n), so long as a Global Note remains
outstanding and is held by or on behalf of the Depository, transfers of
beneficial interests in the Global Note, or transfers by holders of Individual
Notes to transferees that take delivery in the form of beneficial interests in
the Global Note, may be made only in accordance with this subsection
4.02(j) and in accordance with the rules of the Depository.




     (i) Rule 144A Global Note to Regulation S Global Note During the
Distribution Compliance Period. If, during the Distribution
Compliance Period, a Beneficial Owner of an interest in a Rule 144A
Global Note wishes at any time to transfer its beneficial interest in
such Rule 144A Global Note to a Person who wishes to take delivery
thereof in the form of a beneficial interest in a Regulation S Global
Note, such Beneficial Owner may, in addition to complying with all
applicable rules and procedures of the Depository and Clearstream or
Euroclear applicable to transfers by their respective participants (the
“Applicable Procedures”), transfer or cause the transfer of such
beneficial interest for an equivalent beneficial interest in the
Regulation S Global Note only upon compliance with the provisions of this
subsection 4.02(j)(i). Upon receipt by the Note Registrar at its
Corporate Trust Office of (1) written instructions given in accordance
with the Applicable Procedures from a Depository Participant directing
the Note Registrar to credit or cause to be credited to another specified
Depository Participant’s account a beneficial interest in the Regulation
S Global Note in an amount equal to the denomination of the beneficial
interest in the Rule 144A Global Note to be transferred, (2) a written
order given in accordance with the Applicable Procedures containing
information regarding the account of the Depository Participant (and the
Euroclear or Clearstream account, as the case may be) to be credited
with, and the account of the Depository Participant to be debited for,
such beneficial interest, and (3) a certificate in the form of Exhibit
E hereto
given by the Beneficial Owner that is transferring such interest,
the Note Registrar shall instruct the Depository to reduce the
denomination of the Rule 144A Global Note by the denomination of the
beneficial interest in the Rule 144A Global Note to be so transferred
and, concurrently with such reduction, to increase the denomination of
the Regulation S Global Note by the denomination of the beneficial
interest in the Rule 144A Global Note to be so transferred, and to credit
or cause to be credited to the account of the Person specified in such
instructions (who shall be a Depository Participant acting for or on
behalf of Euroclear or Clearstream, or both, as the case may be) a
beneficial interest in the Regulation S Global Note having a denomination
equal to the amount by which the denomination of the Rule 144A Global
Note was reduced upon such transfer.




     (ii) Rule 144A Global Note to Regulation S Global Note After the
Distribution Compliance Period. If, after the Distribution
Compliance Period, a Beneficial Owner of an interest in a Rule 144A
Global Note wishes at any time to transfer its beneficial interest in
such Rule 144A Global Note to a Person who wishes to take delivery
thereof in the form of a beneficial interest in a Regulation S Global
Note, such holder may, in addition to complying with all Applicable
Procedures, transfer or cause the transfer of such beneficial interest
for an equivalent beneficial interest in a Regulation S Global Note only
upon compliance with the provisions of this subsection
4.02(j)(ii). Upon receipt by the Note Registrar at its Corporate
Trust Office of (1) written instructions given in accordance with the
Applicable Procedures from a



31









 






Depository Participant directing the Note
Registrar to credit or cause to be credited to another specified
Depository Participant’s account a beneficial interest in the Regulation
S Global Note in an amount equal to the denomination of the beneficial
interest in the Rule 144A Global Note to be transferred, (2) a written
order given in accordance with the Applicable Procedures containing
information regarding the account of the Depository Participant (and, in
the case of a transfer pursuant to and in accordance with Regulation S,
the Euroclear or Clearstream account, as the case may be) to be credited
with, and the account of the Depository Participant to be debited for,
such beneficial interest, and (3) a certificate in the form of Exhibit
F hereto given by the Beneficial Owner that is transferring such
interest, the Note Registrar shall instruct the Depository to reduce the
denomination of the Rule 144A Global Note by the aggregate denomination
of the beneficial interest in the Rule 144A Global Note to be so
transferred and, concurrently with such reduction, to increase the
denomination of the Regulation S Global Note by the aggregate
denomination of the beneficial interest in the Rule 144A Global Note to
be so transferred, and to credit or cause to be credited to the account
of the Person specified in such instructions (who shall be a Depository
Participant acting for or on behalf of Euroclear or Clearstream, or both,
as the case may be) a beneficial interest in the Regulation S Global Note
having a denomination equal to the amount by which the denomination of
the Rule 144A Global Note was reduced upon such transfer.




     (iii) Regulation S Global Note to Rule 144A Global Note. If
the Beneficial Owner of an interest in a Regulation S Global Note wishes
at any time to transfer its beneficial interest in such Regulation S
Global Note to a Person who wishes to take delivery thereof in the form
of a beneficial interest in the Rule 144A Global Note, such holder may,
in addition to complying with all Applicable Procedures, transfer or
cause the transfer of such beneficial interest for an equivalent
beneficial interest in the Rule 144A Global Note only upon compliance
with the provisions of this subsection 4.02(j)(iii). Upon receipt
by the Note Registrar at its Corporate Trust Office of (1) written
instructions given in accordance with the Applicable Procedures from a
Depository Participant directing the Note Registrar to credit or cause to
be credited to another specified Depository Participant’s account a
beneficial interest in the Rule 144A Global Note in an amount equal to
the denomination of the beneficial interest in the Regulation S Global
Note to be transferred, (2) a written order given in accordance with the
Applicable Procedures containing information regarding the account of the
Depository Participant to be credited with, and the account of the
Depository Participant (or, if such account is held for Euroclear or
Clearstream, the Euroclear or Clearstream account, as the case may be) to
be debited for such beneficial interest, and (3) with respect to a
transfer of a beneficial interest in the Regulation S Global Note for a
beneficial interest in the related Rule 144A Global Note (i) during the
Distribution Compliance Period, a certificate in the form of Exhibit
G hereto given by the Beneficial Owner, or (ii) after the
Distribution Compliance Period, a Rule 144A Certification from the
transferee to the effect that such transferee is a Qualified
Institutional Buyer, the Note Registrar shall instruct the Depository to
reduce the denomination of the Regulation S Global Note by the
denomination of the beneficial interest in the Regulation S Global Note
to be transferred, and, concurrently with such reduction, to increase the
denomination of the Rule 144A Global Note by the aggregate denomination
of the beneficial interest in the Regulation S Global Note to be so
transferred, and to credit or



32









 






cause to be credited to the account of the
Person specified in such instructions (who shall be a Depository
Participant acting for or on behalf of Euroclear or Clearstream, or both,
as the case may be) a beneficial interest in the Rule 144A Global Note
having a denomination equal to the amount by which the denomination of
the Regulation S Global Note was reduced upon such transfer.




     (iv) Transfers Within Regulation S Global Notes During
Distribution Compliance Period. If, during the Distribution
Compliance Period, the Beneficial Owner of an interest in a Regulation S
Global Note wishes at any time to transfer its beneficial interest in
such Trust Certificate to a Person who wishes to take delivery thereof in
the form of a Regulation S Global Note, such Beneficial Owner may
transfer or cause the transfer of such beneficial interest for an
equivalent beneficial interest in such Regulation S Global Note only upon
compliance with the provisions of this subsection 4.02(j)(iv) and
all Applicable Procedures. Upon receipt by the Note Registrar at its
Corporate Trust Office of (1) written instructions given in accordance
with the Applicable Procedures from a Depository Participant directing
the Note Registrar to credit or cause to be credited to another specified
Depository Participant’s account a beneficial interest in such Regulation
S Global Note in an amount equal to the denomination of the beneficial
interest to be transferred, (2) a written order given in accordance with
the Applicable Procedures containing information regarding the account of
the Depository Participant to be credited with, and the account of the
Depository Participant (or, if such account is held for Euroclear or
Clearstream, the Euroclear or Clearstream account, as the case may be) to
be debited for, such beneficial interest and (3) a certificate in the
form of Exhibit H hereto given by the transferee, the Note
Registrar shall instruct the Depository to credit or cause to be credited
to the account of
the Person specified in such instructions (who shall be a Depository
Participant acting for or on behalf of Euroclear or Clearstream, or both,
as the case may be) a beneficial interest in the Regulation S Global Note
having a denomination equal to the amount specified in such instructions
by which the account to be debited was reduced upon such transfer. The
Note Registrar shall not be required to monitor compliance by Beneficial
Owners of the provisions of this subsection 4.02(j)(iv).



     (m) Any and all transfers from a Global Note to a transferee wishing to
take delivery in the form of an Individual Note will require the transferee to
take delivery subject to the restrictions on the transfer of such Individual
Note described on the face of such Note, and such transferee agrees that it
will transfer such Individual Note only as provided therein and herein. No
such transfer shall be made and the Note Registrar shall not register any such
transfer unless such transfer is made in accordance with this subsection
4.02(k).




     (i) Transfers of a beneficial interest in a Global Note to a Person
who is both an Institutional Accredited Investor and a Qualified
Purchaser will require delivery of such Note to the transferee in the
form of an Individual Note and the Note Registrar shall register such
transfer only if prior to the transfer such transferee furnishes to the
Note Registrar (1) a Transferee Letter to the effect that the transfer is
being made to an Institutional Accredited Investor and a Qualified
Purchaser in accordance with an applicable exemption under the Securities
Act, and (2) an Opinion of Counsel acceptable to the Indenture Trustee
that such transfer is in compliance with the Securities Act.



33









 






     (ii) Transfers of a beneficial interest in a Global Note to a
Qualified Institutional Buyer or a Regulation S Investor wishing to take
delivery in the form of an Individual Note will be registered by the Note
Registrar only upon compliance with the provisions of subsection
4.02(j) and if the Note Registrar is provided with a Rule 144A
Certification or a Regulation S Transfer Certificate, as applicable.




     (iii) Notwithstanding the foregoing, no transfer of a beneficial
interest in a Regulation S Global Note to an Individual Note pursuant to
subparagraph (B) above shall be made prior to the expiration of the
Distribution Compliance Period and compliance with the certification
requirements of Rule 903(b)(3)(ii)(B) under the Securities Act. Upon
acceptance for exchange or transfer of a beneficial interest in a Global
Note for an Individual Note, as provided herein, the Note Registrar shall
endorse on the schedule affixed to the related Global Note Registrar (or
on a continuation of such schedule affixed to such Global Note Registrar
and made a part thereof) an appropriate notation evidencing the date of
such exchange or transfer and a decrease in the denomination of such
Global Note Registrar equal to the denomination of such Individual Note
Registrar issued in exchange therefor or upon transfer thereof. Unless
determined otherwise by the Company in accordance with applicable law, an
Individual Note Registrar issued upon transfer of or exchange for a
beneficial interest in the Global Note Registrar shall bear the
Securities Legend.



     (n) Transfers of Individual Note to the Global Notes. If a Holder
of an Individual Note wishes at any time to transfer such Note to a Person who
wishes to take delivery thereof in the form of a beneficial interest in the
related Regulation S Global Note or the related
Rule 144A Global Note, such transfer may be effected only in accordance
with the Applicable Procedures, and this subsection 4.02(l). Upon
receipt by the Note Registrar at the Corporate Trust Office of (1) the
Individual Note to be transferred with an assignment and transfer, (2) written
instructions given in accordance with the Applicable Procedures from a
Depository Participant directing the Note Registrar to credit or cause to be
credited to another specified Depository Participant’s account a beneficial
interest in such Regulation S Global Note or such Rule 144A Global Note, as the
case may be, in an amount equal to the denomination of the Individual Note to
be so transferred, (3) a written order given in accordance with the Applicable
Procedures containing information regarding the account of the Depository
Participant (and, in the case of any transfer pursuant to Regulation S, the
Euroclear or Clearstream account, as the case may be) to be credited with such
beneficial interest, and (4) (x) if delivery is to be taken in the form of a
beneficial interest in the Regulation S Global Note, a Regulation S Transfer
Note from the transferor or (y) a Transferee Letter from the transferee to the
effect that such transferee is a Qualified Institutional Buyer, if delivery is
to be taken in the form of a beneficial interest in the Rule 144A Global Note,
the Note Registrar shall cancel such Individual Note, execute and deliver a new
Individual Note for the denomination of the Individual Note not so transferred,
registered in the name of the Holder, and the Note Registrar shall instruct the
Depository to increase the denomination of the Regulation S Global Note or the
Rule 144A Global Note, as the case may be, by the denomination of the
Individual Note to be so transferred, and to credit or cause to be credited to
the account of the Person specified in such instructions (who, in the case of
any increase in the Regulation S Global Note during the Distribution Compliance
Period, shall be a Depository Participant acting for or on behalf of Euroclear
or Clearstream, or both, as the



34









 







case may be) a corresponding denomination of
the Rule 144A Global Note or the Regulation S Global Note, as the case may be.



     It is the intent of the foregoing that under no circumstances may an
Institutional Accredited Investor that is not a Qualified Institutional Buyer
take delivery in the form of a beneficial interest in a Global Note.



     (o) An exchange of a beneficial interest in a Global Note for an
Individual Note or Notes, an exchange of an Individual Note or Notes for a
beneficial interest in a Global Note and an exchange of an Individual Note or
Notes for another Individual Note or Notes (in each case, whether or not such
exchange is made in anticipation of subsequent transfer, and in the case of the
Global Notes, so long as the Global Notes remain outstanding and are held by or
on behalf of the Depository), may be made only in accordance with this
Section 4.02 and in accordance with the rules of the Depository and
Applicable Procedures.



     (p) (i) Upon acceptance for exchange or transfer of an Individual Note for a
beneficial interest in the Global Note as provided herein, the Note Registrar
shall cancel such Individual Note and shall (or shall request the Depository
to) endorse on the schedule affixed to the applicable Global Note (or on a
continuation of such schedule affixed to the Global Note and made a part
thereof) an appropriate notation evidencing the date of such exchange or
transfer and an increase in the Note balance of the Global Note equal to the
Note balance of such Individual Note exchanged or transferred therefor.




     (ii) Upon acceptance for exchange or transfer of a beneficial
interest in the Global Note for an Individual Note as provided herein,
the Note Registrar shall (or shall
request the Depository to) endorse on the schedule affixed to the
Global Note (or on a continuation of such schedule affixed to the Global
Note and made a part thereof) an appropriate notation evidencing the date
of such exchange or transfer and a decrease in the Note balance of the
Global Note equal to the Note balance of such Individual Note issued in
exchange therefor or upon transfer thereof.



     (q) The Securities Legend shall be placed on any Individual Note issued in
exchange for or upon transfer of another Individual Note or of a beneficial
interest in the Global Note.



     (r) Subject to the restrictions on transfer and exchange set forth in this
Section 4.02, the holder of any Individual Note may transfer or exchange
the same in whole or in part (in an initial Note balance equal to the minimum
authorized denomination of $500,000 or any integral multiple of $1,000 in
excess thereof) by surrendering such Note at the Corporate Trust Office, or at
the office of any transfer agent, together with an executed instrument of
assignment and transfer satisfactory in form and substance to the Note
Registrar in the case of transfer and a written request for exchange in the
case of exchange. The holder of a beneficial interest in a Global Note may,
subject to the rules and procedures of the Depository, cause the Depository (or
its nominee) to notify the Note Registrar in writing of a request for transfer
or exchange of such beneficial interest for an Individual Note or Notes.
Following a proper request for transfer or exchange, the Note Registrar shall,
within five (5) Business Days of such request made at such Corporate Trust
Office, cause the Indenture Trustee to authenticate and the Note Registrar to
deliver at such Corporate Trust Office, to the transferee (in the case of
transfer) or holder (in the case of exchange) or send by first class mail at
the risk of the transferee (in the case of transfer) or holder (in the



35









 







case of
exchange) to such address as the transferee or holder, as applicable, may
request, an Individual Note or Notes, as the case may require, for a like
aggregate Percentage Interest and in such authorized denomination or
denominations as may be requested. The presentation for transfer or exchange
of any Individual Note shall not be valid unless made at the Corporate Trust
Office by the registered holder in person, or by a duly authorized
attorney–in–fact.



     (s) No transfer of any Note shall be made unless such transfer is exempt
from the registration requirements of the Securities Act and any applicable
state securities laws or is made in accordance with said Act and laws. No
transfer of any Note shall be made if such transfer would require the Issuer to
register as an “investment company” under the Investment Company Act. In the
event of any such transfer, unless such transfer is made in reliance upon Rule
144A under the Securities Act or Regulation S under the Securities Act, (i) the
Indenture Trustee may require a written Opinion of Counsel acceptable to and in
form and substance reasonably satisfactory to the Indenture Trustee that such
transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from said Act and laws or is being made
pursuant to said Act and laws, which Opinion of Counsel shall not be an expense
of the Indenture Trustee, the Issuer, or the Servicer and (ii) the Indenture
Trustee shall require the transferee to execute a Transferee Letter certifying
to the Issuer and the Indenture Trustee the facts surrounding such transfer,
which Transferee Letter shall not be an expense of the Indenture Trustee, the
Issuer or the Servicer. The holder of a Note desiring to effect such transfer
shall, and by accepting a Note and the benefits of this Indenture does hereby
agree to, indemnify the Indenture Trustee, the Issuer, the Servicer and the
Initial Purchasers against any liability that may result if the transfer is not
so exempt or is not made in accordance with such federal and state
laws. None of the Issuer, the Indenture Trustee, the Trust Depositor or
the Initial Purchasers intends or is obligated to register or qualify any Note
under the Securities Act or any state securities laws.



     (t) Notwithstanding any other provision of this Agreement to the contrary,
on the Closing Date, the Indenture Trustee shall authenticate in the name of,
and deliver to, the Trust Depositor, the Class E Note in the form of a single
Individual Note in an aggregate principal amount equal to the Initial Class E
Principal Balance. The Holder of the Class E Note shall initially be the Trust
Depositor. No transfer, sale, pledge or other disposition of one or more Class
E Notes (a “Transfer”) shall be made unless simultaneously with the
Transfer (1) a proportionate amount of Trust Certificates are Transferred so
that the ratio of the Percentage Interest of the Trust Certificates so
Transferred to all Trust Certificates and the ratio of the Percentage Interest
of the Class E Notes so Transferred to all Class E Notes are equal, (2) the
Transfers of the Trust Certificates and Class E Notes referred to herein are
made to the same Person, and (3) the Percentage Interest of the Trust
Certificates and Class E Notes, respectively, so transferred is no less than
ten (10%) percent.



     (u) The Class E Notes may only be owned by United States Persons (as
defined in Section 7701(a)(30) of the Code).



     (v) No Class E Note may be acquired directly or indirectly, for, on behalf
of or with plan assets of an employee benefit plan or other retirement
arrangement subject to ERISA,



36









 







and/or Section 4975 of the Code (collectively, a
“Plan”). No transfer of a Class E Note representing an Individual Note
shall be made unless the Indenture Trustee shall have received a certification
from the transferee of such Individual Note, acceptable to and in form and
substance satisfactory to the Indenture Trustee and the Issuer, to the effect
that such transferee is acquiring a Class E Note in conformance with the
requirements of the preceding sentence. Notwithstanding anything else to the
contrary herein, in the event any purported transfer of any Class E Note
representing an Individual Note is made without delivery of the certification
referred to above, such certification shall be deemed to have been made by the
Transferee by its acceptance of such Individual Note.



     Section 4.03 Mutilated, Destroyed, Lost or Stolen Notes.



     Subject to UCC § 8–405, if (i) any mutilated Note is surrendered to the
Indenture Trustee, or the Indenture Trustee receives evidence to its
satisfaction of the destruction, loss or theft of any Note, and (ii) there is
delivered to the Indenture Trustee such security or indemnity as may be
required by it to hold the Issuer and the Indenture Trustee harmless, then, in
the absence of notice to the Issuer, the Note Registrar or the Indenture
Trustee that such Note has been acquired by a protected purchaser, the Issuer
shall execute, and upon its request the Indenture Trustee shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Note, a replacement Note; provided, however, that if
any such destroyed, lost or stolen Note, but not a mutilated Note, shall have
become or within seven (7) days shall be due and payable, or shall have been
called for redemption, instead of issuing a replacement Note, the Issuer may
pay such destroyed, lost or stolen Note when so due or payable or upon the
Redemption Date without surrender thereof. If, after the delivery of such
replacement Note or payment of a destroyed, lost or stolen Note pursuant to the
proviso to the
preceding sentence, a protected purchaser of the original Note in lieu of
which such replacement Note was issued presents for payment such original Note,
the Issuer and the Indenture Trustee shall be entitled to recover such
replacement Note (or such payment) from the Person to whom it was delivered or
any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a
protected purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Issuer or the Indenture Trustee in connection therewith.



     Upon the issuance of any replacement Note under this Section 4.03,
the Issuer may require the payment by the Holder of such Note of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other reasonable expenses (including the fees and
expenses of the Indenture Trustee) connected therewith.



     Every replacement Note issued pursuant to this Section 4.03 in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute
an original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.



37









 





     The provisions of this Section 4.03 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.



     Section 4.04 Payment of Principal and Interest; Defaulted Interest.



     (a) The Notes shall accrue interest during each Interest Accrual Period on
the basis of the actual number of days elapsed during such Interest Accrual
Period and a year assumed to consist of 360 days. Any installment of interest
or principal, if any, payable on any Note which is punctually paid or duly
provided for by the Issuer on the applicable Remittance Date shall be paid to
the Person in whose name such Note is registered on the Record Date, by check
mailed first–class, postage prepaid, to such Person’s address as it appears on
the Note Register on such Record Date, except that, unless Global Notes have
been issued pursuant to Section 4.02, with respect to Notes registered
on the Record Date in the name of the nominee of the Depository (initially,
such nominee to be Cede & Co.), payment will be made by wire transfer in
immediately available funds to the account designated by such Person and except
for the final installment of principal payable with respect to such Note on a
Remittance Date or on the applicable Expected Maturity Date and except for the
Redemption Price for any Note called for redemption pursuant to Section
10.01(a) which shall be payable as provided below. The funds represented
by any such checks returned undelivered shall be held in accordance with
Section 3.03.



     (b) The principal of each Note shall be payable in installments on each
Remittance Date as provided in the Sale and Servicing Agreement.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable, if not previously paid, on the date on which an Event
of Default shall have occurred and be continuing, if the Indenture Trustee with
the consent of the Majority Noteholders have declared the Notes to be
immediately due and
payable in the manner provided in Section 5.02. All principal
payments among the Classes of Notes shall be made in the order and priorities
set forth herein and in the Sale and Servicing Agreement, and all principal
payments on the Notes of the same Class shall be made pro rata to the
Noteholders of such Class. The Indenture Trustee shall notify the Person in
whose name a Note is registered at the close of business on the Record Date
preceding the Remittance Date on which the Issuer expects that the final
installment of principal of and interest on such Note will be paid. Such
notice shall be mailed or transmitted by facsimile prior to such final
Remittance Date and shall specify that such final installment will be payable
only upon presentation and surrender of such Note and shall specify the place
where such Note may be presented and surrendered for payment of such
installment. Notices in connection with redemptions of Notes shall be mailed
to Noteholders as provided in Section 10.02.



     (c) For so long as the Notes of any Class are listed on the Irish Stock
Exchange and the rules of such exchange shall so require, the Issuer will have
a paying agent and transfer agent for such securities in Ireland, and payments
on and transfers or exchanges of interests in such Notes (including partial
interests therein) may be effected through such paying and transfer agent (or
any other paying and transfer agent); provided, that, all
transfers and exchanges must be effected in accordance with this Indenture. In
addition, for so long as the Notes of any Class are listed on the Irish Stock
Exchange and the rules of such exchange shall so require, in the case of a
transfer or exchange of a physical instrument representing such security, a
holder thereof may



38









 







obtain a new physical instrument from the paying agent and
transfer agent in Ireland in accordance with this Indenture.



     Section 4.05 Tax Treatment.




     The Issuer has entered into this Indenture, and the Notes will be issued,
with the intention that, for federal, state and local income, business and
franchise tax purposes, (i) the Notes (other than the Class E Note) will
qualify as indebtedness secured by the Indenture Collateral and (ii) the Issuer
shall not be treated as an association, taxable mortgage pool or publicly
traded partnership taxable as a corporation. The Issuer, by entering into this
Indenture, and each Noteholder (other than the Class E Noteholder), by the
acceptance of any such Note (and each beneficial owner of a Note, by its
acceptance of an interest in the applicable Note), agree to treat such Notes
for federal, state and local income and franchise tax purposes as indebtedness
of the Issuer. Each Holder of such Note (other than the Class E Noteholder)
agrees that it will cause any beneficial owner of such Note acquiring an
interest in a Note through it to comply with this Indenture as to treatment of
indebtedness under applicable tax law, as described in this Section
4.05. The parties hereto agree that they shall not cause or permit the
making, as applicable, of any election under Treasury Regulation Section
301.7703–3 whereby the Issuer or any portion thereof would be treated as a
corporation for federal income tax purposes and, except as required by the
terms of this Indenture, shall not file tax returns or obtain any federal
employer identification number for the Issuer, but shall treat the Issuer as a
security device or disregarded entity for federal income tax purposes. The
provisions of this Indenture shall be construed in furtherance of the foregoing
intended tax treatment.



     It is the intent of the Trust Depositor, the Servicer, the Class E
Noteholder and the Certificateholder that, (i) in the event that the Trust
Certificate and the Class E Note are owned by a single Holder, for federal
income tax purposes, the Trust will be treated as a division of such
Holder, and such Holder, by acceptance of the Trust Certificate and the
Class E Note, agrees to take no action inconsistent with such treatment and
(ii) in the event that the Trust Certificates and/or the Class E Notes are
owned by more than one (1) Holder, for federal income tax purposes, the Trust
will be treated as a partnership, the partners of which are the
Certificateholders and the Class E Noteholders, and each Certificateholder and
Class E Noteholder, by acceptance of a Trust Certificate and a Class E Note,
respectively, agree to treat the Trust Certificate and the Class E Note as
equity and to take no action inconsistent with such treatment.



     Section 4.06 Satisfaction and Discharge of Indenture.



     This Indenture shall cease to be of further effect with respect to the
Notes except as to (i) rights of registration of transfer and exchange, (ii)
substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of
Noteholders to receive payments of principal thereof and interest thereon, (iv)
Sections 3.03, 3.04, 3.06, 3.10, 3.19,
3.21, 3.22, 4.05 and 11.16, (v) the rights,
obligations and immunities of the Indenture Trustee hereunder (including the
rights of the Indenture Trustee under Section 6.07 and the obligations
of the Indenture Trustee under Section 4.07) and (vi) the rights of
Noteholders as beneficiaries hereof with respect to the property so deposited
with the Indenture Trustee payable to all or any of them, and the Indenture



39









 







Trustee, on written demand of and at the expense of the Issuer, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture
with respect to the Notes, when:




     (A) either




(1) all Notes of such Series theretofore authenticated and
delivered (other than (i) Notes that have been destroyed, lost or
stolen and that have been replaced or paid as provided in
Section 4.03 and (ii) Notes for whose payment money has
theretofore been deposited in trust or segregated and held in trust
by the Issuer and thereafter repaid to the Issuer or discharged
from such trust, as provided in Section 3.03) have been
delivered to the Indenture Trustee for cancellation; or




(2) all Notes not theretofore delivered to the Indenture Trustee
for cancellation




(i) have become due and payable, or




(ii) are to be called for redemption within one year under
arrangements satisfactory to the Indenture Trustee for the giving
of notice of redemption by the Indenture Trustee in the name, and
at the expense, of the Issuer,




and the Issuer, in the case of (2)(i) or (ii) above, has
irrevocably deposited or caused to be irrevocably deposited with
the Indenture Trustee cash or direct obligations of or obligations
guaranteed by the United States of America (which will mature prior
to the date such amounts are payable), in trust for such purpose,
in an amount sufficient to pay and discharge the entire
indebtedness on such
Notes not theretofore delivered to the Indenture Trustee for
cancellation when due to the Legal Final Maturity Date therefor or
Redemption Date (if Notes shall have been called for redemption
pursuant to Section 10.01), as the case may be; and




     (B) the Issuer has delivered to the Indenture Trustee an
Officer’s Certificate meeting the applicable requirements of
Section 11.01 and, subject to Section 11.01, stating
that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture with respect to the
Notes have been complied with.



     This Indenture shall cease to be of further effect with respect to each
Hedge Agreement when such Hedge Agreement has been terminated and the Hedge
Counterparty has received all amounts it is entitled to receive upon such
termination.



     Section 4.07 Application of Trust Money.



     All moneys deposited with the Indenture Trustee pursuant to Section
4.06 hereof shall be held in trust and applied by it, in accordance with
the provisions of the Notes and this Indenture, to the payment, either directly
or through any Paying Agent, as the Indenture Trustee may determine, to the
Holders of Notes for the payment or redemption of which such moneys have been
deposited with the Indenture Trustee, of all sums due and to become due thereon
for



40









 







principal and interest; but such moneys need not be segregated from other
funds except to the extent required herein or in the Sale and Servicing
Agreement or required by law.



     Section 4.08 Repayment of Moneys Held by Paying Agent.



     In connection with the satisfaction and discharge of this Indenture with
respect to the Notes, all moneys then held by any Paying Agent other than the
Indenture Trustee under the provisions of this Indenture with respect to such
Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to be
held and applied according to Section 3.05 and thereupon such Paying
Agent shall be released from all further liability with respect to such moneys.



ARTICLE V




REMEDIES




     Section 5.01 Events of Default.



     Any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body) shall
constitute an Event of Default:




     (i) a default in the payment of any interest on any Note when the
same becomes due and payable and such default shall continue for a period
of two (2) Business Days;




     (ii) failure to reduce to zero the Aggregate Outstanding Principal
Balance by the Legal Final Maturity Date;




     (iii) failure to pay the Redemption Price to the Noteholders and the
Hedge Counterparties on the Redemption Date in the event of an optional
redemption pursuant to Section 10.01 of this Indenture;




     (iv) failure on the part of the Originator to make any payment or
deposit required under the Sale and Servicing Agreement within two (2)
Business Days after the date the payment or deposit is required to be
made;




     (v) there occurs a default in the observance or performance in any
material respect of any covenant or agreement of the Originator, the
Trust Depositor or the Issuer made in the Sale and Servicing Agreement or
this Indenture, or any representation or warranty of the Originator, the
Trust Depositor or the Issuer made in the Sale and Servicing Agreement or
this Indenture proving to have been incorrect in any material respect as
of the time when the same shall have been made and such default or
incorrect representation or warranty has a material adverse effect on the
rights of the Noteholders and the Hedge Counterparties, and such default
shall continue or not be cured, or the circumstance or condition in
respect of which such representation or warranty was incorrect shall not
have been eliminated or otherwise cured, for a period of 30 days (if such
failure can be remedied) after the first to occur of (i) actual knowledge
thereof by a



41









 






Responsible Officer of the Trust Depositor or (ii) there
shall have been given to the Issuer by the Indenture Trustee or to the
Issuer and the Indenture Trustee, by any Noteholder, a written notice
specifying such default or incorrect representation or warranty and
requiring it to be remedied and stating that such notice is a notice of
default hereunder;




     (vi) there occurs the filing of a decree or order for relief by a
court having jurisdiction in the premises in respect of the Trust
Depositor, the Issuer or any substantial part of the Indenture Collateral
in an involuntary case under any applicable federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or appointing
a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of the Trust Depositor, the Issuer or for any
substantial part of either Indenture Collateral, or ordering the
winding–up or liquidation of the Trust Depositor’s or the Issuer’s
affairs, and such decree or order shall remain unstayed and in effect for
a period of thirty (30) consecutive days;




     (vii) there occurs the commencement by the Trust Depositor or the
Issuer of a voluntary case under any applicable federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect,
or the consent by the Trust Depositor or the Issuer to the entry of an
order for relief in an involuntary case under any such law, or the
consent by the Trust Depositor or the Issuer to the appointment or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Trust Depositor or the Issuer or
for any substantial part of the assets of the Indenture Collateral, or
the making by the Trust Depositor or the Issuer of any general assignment
for the benefit of creditors, or the failure by the Trust Depositor or
the Issuer generally to
pay its debts as such debts become due, or the taking of any action
by the Trust Depositor or the Issuer in furtherance of any of the
foregoing;




     (viii) the Indenture Trustee, on behalf of the Noteholders and the
Hedge Counterparties, shall fail to have a valid and perfected first
priority security interest in the Indenture Collateral, and such failure
to have a perfected first priority security interest shall have a
material adverse effect on the Noteholders and the Hedge Counterparties;




     (ix) either the Issuer or the Loan Pool is required to be registered
as an “investment company” under the Investment Company Act of 1940, as
amended; or




     (x) on any day, any Hedge Transaction fails to meet the requirements
set forth in this Agreement.



     The Issuer shall deliver to the Indenture Trustee, each Hedge Counterparty
and the Rating Agencies, within two (2) Business Days after the occurrence of
an Event of Default, written notice in the form of an Officer’s Certificate of
any event which with the giving of notice and the lapse of time would become an
Event of Default under clause (v) of the definition of “Event of
Default,” its status and what action the Issuer is taking or proposes to take
with respect thereto.



     Section 5.02 Acceleration of Maturity; Rescission and Annulment.



     If an Event of Default should occur and be continuing, then and in every
such case the Indenture Trustee or the Majority Noteholders may declare the
Notes to be immediately due
and



42









 







payable, by a notice in writing to the Issuer
and the Rating Agencies (and to the Indenture Trustee if given by Noteholders),
and upon any such declaration the unpaid principal amount of such Notes,
together with accrued and unpaid interest thereon through the date of
acceleration, shall become immediately due and payable.



     At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Indenture Trustee as hereinafter in this Article V
provided, the Majority Noteholders, by written notice to the Issuer and the
Indenture Trustee and each Hedge Counterparty, may rescind and annul such
declaration and its consequences if:




     (A) the Issuer has paid or deposited with the Indenture
Trustee a sum sufficient to pay:




     (i) all payments of principal of and interest on the
Notes, all scheduled payments then due and payable under each
Hedge Agreement and all other amounts that would then be due
hereunder, upon the Notes and each Hedge Agreement if the
Event of Default giving rise to such acceleration had not
occurred; and




     (ii) all sums paid or advanced by the Indenture Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and its
agents and counsel; and




     (B) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such
acceleration, have been cured or waived as provided in Section
5.12.



     No such rescission or annulment shall affect any subsequent default or
impair any right consequent thereto. No such rescission or annulment shall
affect a Hedge Agreement or any Hedge Transaction that has been terminated in
accordance with the terms thereof.



     Section 5.03 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee.



     (a) The Issuer covenants that if (i) default is made in the payment of any
interest on any Note when the same becomes due and payable, and such default
continues for a period of five Business Days, or (ii) default is made in the
payment of the principal of or any installment of the principal of any Note
when the same becomes due and payable, and such default continues for a period
of two Business Days, the Issuer will, upon demand of the Indenture Trustee,
pay to it, for the benefit of the Noteholders, the whole amount then due and
payable on the Notes for principal and interest, with interest upon the overdue
principal, and in addition thereto such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Indenture Trustee and
its agents and counsel.



     (b) In case the Issuer shall fail forthwith to pay such amounts upon such
demand, the Indenture Trustee, in its own name and as trustee of an express
trust, with the consent of the



43









 







Majority Noteholders and subject to the
provisions of Section 11.17 hereof may institute a Proceeding for the
collection of the sums so due and unpaid, and may prosecute such Proceeding to
judgment or final decree, and may enforce the same against the Issuer or other
obligor upon the Notes and collect in the manner provided by law out of the
Indenture Collateral, wherever situated, the moneys adjudged or decreed to be
payable.



     (c) If an Event of Default occurs and is continuing, the Indenture Trustee
subject to the provisions of Section 11.17 hereof may, as more
particularly provided in Section 5.04, in its discretion, proceed to
protect and enforce its rights and the rights of the Noteholders and the Hedge
Counterparties and by such appropriate Proceedings as the Indenture Trustee
shall deem most effective to protect and enforce any such rights, whether for
the specific enforcement of any covenant or agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy or legal or equitable right vested in the Indenture Trustee by this
Indenture or by law.



     (d) In case there shall be pending, relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest
in the Indenture Collateral, Proceedings under Title 11 of the United States
Code or any other applicable federal or state bankruptcy, insolvency or other
similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor or Person, or in case of any other comparable judicial Proceedings
relative to the Issuer or other obligor upon the Notes, or to the creditors or
property of the Issuer or such other obligor, the Indenture
Trustee, irrespective of whether the principal of any Notes shall then be
due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Indenture Trustee shall have made any demand
pursuant to the provisions of this Section 5.03, shall be entitled and
empowered, by intervention in such Proceedings or otherwise:




     (i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to
file such other papers or documents as may be necessary or advisable in
order to have the claims of the Indenture Trustee (including any claim
for reasonable compensation to the Indenture Trustee and each predecessor
Indenture Trustee, and their respective agents, attorneys and counsel,
and for reimbursement of all reasonable expenses and liabilities
incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee, except as a result of negligence or bad
faith) and of the Noteholders allowed in such Proceedings;




     (ii) unless prohibited by applicable law and regulations, to vote on
behalf of the Holders of Notes in any election of a trustee, a standby
trustee or Person performing similar functions in any such Proceedings;




     (iii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute all amounts received
with respect to the claims of the Noteholders and of the Indenture
Trustee on their behalf;



44









 






     (iv) to file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the
Indenture Trustee or the Noteholders allowed in any judicial proceedings
relative to the Issuer, its creditors and its property; and




     (v) to participate as a member, voting or otherwise, of any official
committee of creditors appointed in such matter;



and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Indenture Trustee, and, in the event that the Indenture Trustee
shall consent to the making of payments directly to such Noteholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee except as a result of negligence or bad faith.



     (e) Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the
election of a trustee in bankruptcy or similar Person.



     (f) All rights of action and of asserting claims under this Indenture, or
under any of the Notes, may be enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any trial or other
Proceedings relative thereto, and any such action or proceedings instituted by
the Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Holders of the Notes.



     (g) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Holders of the Notes, and it shall not be necessary
to make any Noteholder a party to any such Proceedings.



     (h) Notwithstanding anything to the contrary contained in this Indenture
(including, without limitation, Sections 5.4(a), 5.10 and
5.11), if the Issuer fails to perform its obligations under Section
10.01 when and as due, the Indenture Trustee shall, at the direction of the
Class A-1 Noteholders evidencing 66 2/3% of the aggregate Outstanding Principal
Balance of all Class A-1 Notes, the Class A-2 Noteholders evidencing 66 2/3% of
the aggregate Outstanding Principal Balance of all Class A-2 Notes, the Class B
Noteholders evidencing 66 2/3% of the aggregate Outstanding Principal Balance
of all Class B Notes, the Class C Noteholders evidencing 66 2/3% of the
aggregate Outstanding Principal Balance of all Class C Notes or the Class D
Noteholders evidencing 66 2/3% of the aggregate Outstanding Principal Balance
of all



45









 







Class D Notes, proceed to protect and enforce its rights and the rights
of the Noteholders by such appropriate proceedings as the Indenture Trustee
shall deem most effective to protect and enforce any such rights, whether for
specific performance of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper
remedy or legal or equitable right vested in the Indenture Trustee by this
Indenture or by law.



     Section 5.04 Remedies; Priorities.



     (a) If an Event of Default shall have occurred and be continuing, subject
to the provisions of Section 11.17 hereof, the Indenture Trustee may do
one or more of the following (subject to Section 5.05 and Section
5.15):




     (i) institute Proceedings in its own name and as trustee of an
express trust for the collection of all amounts then payable on the Notes
or under this Indenture with respect thereto, whether by declaration or
otherwise, and all amounts payable under the Sale and Servicing
Agreement, enforce any judgment obtained, and collect from the Issuer and
any other obligor upon such Notes moneys adjudged due;




     (ii) institute Proceedings from time to time for the complete or
partial foreclosure of this Indenture with respect to the Indenture
Collateral;




     (iii) exercise any remedies of a secured party under the UCC and
take any other appropriate action to protect and enforce the rights and
remedies of the Indenture Trustee, the Holders of the Notes and the Hedge
Counterparties; and




     (iv) sell the Indenture Collateral or any portion thereof or rights
or interest therein;



provided, however, that the Indenture Trustee may not sell or
otherwise liquidate the Indenture Collateral following an Event of Default,
other than a default in the payment of any principal or interest on the Notes
for 30 days or more, unless (A) (i) prior to the payment in full of the Class
A-1 Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes and the
Class D Notes, the Class A-1 Noteholders evidencing 100% of the aggregate
Outstanding Principal Balance of all Class A-1 Notes, the Class A-2 Noteholders
evidencing 100% of the aggregate Outstanding Principal Balance of all Class A-2
Notes, the Class B Noteholders evidencing 100% of the aggregate Outstanding
Principal Balance of all Class B Notes, the Class C Noteholders evidencing 100%
of the aggregate Outstanding Principal Balance of all Class C Notes and the
Class D Noteholders evidencing 100% of the aggregate Outstanding Principal
Balance of all Class D Notes and, unless it shall be paid in full all amounts
payable to each Hedge Counterparty upon a termination of its Hedge Agreement,
each Hedge Counterparty consents thereto, (ii) from and after the payment in
full of the Class A-1 Notes, the Class A-2 Notes, the Class B Notes, the Class
C Notes, the Class D Notes and amounts due under the Hedge Agreements, the
Class E Noteholders evidencing 100% of the aggregate Outstanding Principal
Balance of the Class E Note consents thereto, (B) the proceeds of such sale or
liquidation distributable to the Noteholders are sufficient to discharge in
full all amounts then due and unpaid upon the Notes for principal and interest
and all amounts payable to each Hedge Counterparty upon termination of the
Hedge Agreements, or (C) the Indenture Trustee determines that the Loans will
not


46









 






continue to provide sufficient funds for the payment of principal of and
interest on the Notes, in accordance with their respective terms as they would
have become due if the Notes had not been declared due and payable, and the
Indenture Trustee obtains the consent of (i) prior to the payment in full of
the Class A-1 Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes
and the Class D Notes, the Class A-1 Noteholders evidencing 66 2/3% of the
aggregate Outstanding Principal Balance of all Class A-1 Notes, the Class A-2
Noteholders evidencing 66 2/3% of the aggregate Outstanding Principal Balance
of all Class A-2 Notes, the Class B Noteholders evidencing 66 2/3% of the
aggregate Outstanding Principal Balance of all Class B Notes, the Class C
Noteholders evidencing 66 2/3% of the aggregate Outstanding Principal Balance
of all Class C Notes and the Class D Noteholders evidencing 66 2/3% of the
aggregate Outstanding Principal Balance of all Class D Notes and, unless it
shall be paid in full all amounts payable to each Hedge Counterparty upon a
termination of its Hedge Agreement, each Hedge Counterparty, and (ii) from and
after the payment in full of the Class A-1 Notes, the Class A-2 Notes, the
Class B Notes, the Class C Notes, the Class D Notes and amounts due under the
Hedge Agreements, the Class E Noteholders evidencing 66 2/3% of the aggregate
Outstanding Principal Balance of the Class E Notes. In determining such
sufficiency or insufficiency with respect to clauses (B) and (C),
the Indenture Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation
 as to
the feasibility of such proposed action and as to the sufficiency of the
Indenture Collateral for such purpose. Notwithstanding the foregoing, so long
as a Servicer Default has not occurred, any Sale of the Indenture Collateral
shall be made subject to the continued servicing of the Loans by the Servicer
as provided in the Sale and Servicing Agreement.



     (b) If the Indenture Trustee collects any money or property pursuant to
this Article V, it shall pay out the money or property as set forth in
Section 7.05 of the Sale and Servicing Agreement.



     The Indenture Trustee may fix a record date and Remittance Date for any
payment to Noteholders pursuant to this Section 5.04. At least five
days before such record date, the Issuer shall mail to each Noteholder and the
Indenture Trustee a notice that states the record date, the Remittance Date and
the amount to be paid.



     Section 5.05 Optional Preservation of the Indenture Collateral.



     If the Notes have been declared to be due and payable under Section
5.02 following an Event of Default and such declaration and its
consequences have not been rescinded and annulled, the Indenture Trustee may,
but need not, elect to maintain possession of the Indenture Collateral. It is
the desire of the parties hereto and the Noteholders that there be at all times
sufficient funds for the payment of principal of and interest on the Notes,
amounts due under the Hedge Agreements and other obligations of the Issuer and
the Indenture Trustee shall take such desire into account when determining
whether or not to maintain possession of the Indenture Collateral. In
determining whether to maintain possession of the Indenture Collateral, the
Indenture Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the
Indenture Collateral for such purpose.



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     Section 5.06 Limitation of Suits.



     No Holder of any Note shall have any right to institute any Proceeding,
judicial or otherwise, with respect to this Indenture, or for the appointment
of a receiver or trustee, or for any other remedy hereunder, unless and subject
to the provisions of Section 11.17 hereof:




     (i) such Holder has previously given written notice to the Indenture
Trustee of a continuing Event of Default;




     (ii) (A) prior to the payment in full of the Class A-1 Notes, the
Class A-2 Notes, the Class B Notes, the Class C Notes and the Class D
Notes, the Class A-1 Noteholders evidencing 25% of the aggregate
Outstanding Principal Balance of all Class A-1 Notes, the Class A-2
Noteholders evidencing 25% of the aggregate Outstanding Principal Balance
of all Class A-2 Notes, the Class B Noteholders evidencing 25% of the
aggregate Outstanding Principal Balance of all Class B Notes, the Class C
Noteholders evidencing 25% of the aggregate Outstanding Principal Balance
of all Class C Notes and the Class D Noteholders evidencing 25% of the
aggregate Outstanding Principal Balance of all Class D Notes have made
written request to the Indenture Trustee to institute such Proceeding in
respect of such Event of Default in its own name as Indenture Trustee
hereunder and (B) from and after the payment in full of the Class A-1
Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes and the
Class D Notes, the Class E Noteholders evidencing 25% of the
aggregate Outstanding Principal Balance of the Class E Notes have made
written request to the Indenture Trustee to institute such proceeding in
respect of such Event of Default in its own name as Indenture Trustee
hereunder;




     (iii) such Holder or Holders have offered to the Indenture Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in complying with such request;




     (iv) the Indenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute such
Proceedings; and




     (v) (A) prior to the payment in full of the Class A-1 Notes, the
Class A-2 Notes, the Class B Notes, the Class C Notes and the Class D
Notes, no direction inconsistent with such written request has been given
to the Indenture Trustee during such 60 day period by the Holders of a
majority of the Outstanding Principal Balance of the Class A-1 Notes, the
Class A-2 Notes, the Class B Notes, the Class C Notes and Class D Notes
and (B) from and after payment in full of the Class A-1 Notes, the Class
A-2 Notes, the Class B Notes, the Class C Notes and the Class D Notes, no
direction inconsistent with such written request has been given to the
Indenture Trustee during such 60 day period by the Holders of a majority
of the Outstanding Principal Balance of the Class E Notes.



It is understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
Holders of Notes or to obtain or to seek to obtain priority or


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preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided.



     In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Notes, each representing less than a majority of the Aggregate Outstanding
Principal Balance, the Indenture Trustee in its sole discretion may determine
what action, if any, shall be taken, notwithstanding any other provisions of
this Indenture.



     Section 5.07 Unconditional Rights of Noteholders To Receive Principal and Interest.



     Notwithstanding any other provisions in this Indenture, the Holder of any
Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of and interest, if any, on such Note on or after the
respective due dates thereof expressed in such Note or in this Indenture (or,
in the case of redemption, on or after the Redemption Date) and such right
shall not be impaired without the consent of such Holder.



     Section 5.08 Restoration of Rights and Remedies.



     If the Indenture Trustee or any Noteholder has instituted any Proceeding
to enforce any right or remedy under this Indenture and such Proceeding has
been discontinued or abandoned
for any reason or has been determined adversely to the Indenture Trustee
or to such Noteholder, then and in every such case the Issuer, the Indenture
Trustee and the Noteholders shall, subject to any determination in such
Proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Indenture Trustee and
the Noteholders shall continue as though no such Proceeding had been
instituted.



     Section 5.09 Rights and Remedies Cumulative.



     No right or remedy herein conferred upon or reserved to the Indenture
Trustee or to the Noteholders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other appropriate right or
remedy.



     Section 5.10 Delay or Omission Not a Waiver.



     No delay or omission of the Indenture Trustee or any Holder of any Note to
exercise any right or remedy accruing upon any Default or Event of Default
shall impair any such right or remedy or constitute a waiver of any such
Default or Event of Default or an acquiescence therein. Every right and remedy
given by this Article V or by law to the Indenture Trustee or to the
Noteholders may be exercised from time to time, and as often as may be deemed
expedient, by the Indenture Trustee or by the Noteholders, as the case may be.



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     Section 5.11 Control by Noteholders.



     The Majority Noteholders shall have the right to direct the time, method
and place of conducting any Proceeding for any remedy available to the
Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided, that:




     (i) such direction shall not be in conflict with any rule of law or
with this Indenture;




     (ii) subject to the express terms of Section 5.04, any
direction to the Indenture Trustee to sell or liquidate the Indenture
Collateral shall be by Holders of the Notes representing (A) prior to the
payment in full of the Class A-1 Notes, the Class A-2 Notes, the Class B
Notes, the Class C Notes and the Class D Notes, 100% of the aggregate
Outstanding Principal Balance of all Class A-1 Notes, all Class A-2
Notes, all Class B Notes, all Class C Notes, all Class D Notes and,
unless it shall be paid in full all amounts payable to each Hedge
Counterparty upon a termination of its Hedge Agreement, each Hedge
Counterparty and (B) from and after the payment in full of the Class A-1
Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes, the
Class D Notes and amounts due under the Hedge Agreements, 100% of the
aggregate Outstanding Principal Balance of the Class E Notes;




     (iii) if the conditions set forth in Section 5.05 have been
satisfied and the Indenture Trustee elects to retain the Indenture
Collateral pursuant to such Section,
then any direction to the Indenture Trustee to sell or liquidate the
Indenture Collateral shall be of no force and effect unless (A) prior to
the payment in full of the Class A-1 Notes, the Class A-2 Notes, the
Class B Notes, the Class C Notes and the Class D Notes, the Class A-1
Noteholders evidencing 100% of the aggregate Outstanding Principal
Balance of all Class A-1 Notes, Class A-2 Noteholders evidencing 100% of
the aggregate Outstanding Principal Balance of all Class A-2 Notes, the
Class B Noteholders evidencing 100% of the aggregate Outstanding
Principal Balance of all Class B Notes, the Class C Noteholders
evidencing 100% of the aggregate Outstanding Principal Balance of all
Class C Notes, the Class D Noteholders evidencing 100% of the aggregate
Outstanding Principal Balance of all Class D Notes and, unless it shall
be paid in full all amounts payable to each Hedge Counterparty upon a
termination of its Hedge Agreement, each Hedge Counterparty consent
thereto and (B) from and after the payment in full of the Class A-1
Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes, the
Class D Notes and amounts due under the Hedge Agreements, the Class E
Noteholders evidencing 100% of the aggregate Outstanding Principal
Balance of the Class E Notes consents thereto; and




     (iv) the Indenture Trustee may take any other action deemed proper
by the Indenture Trustee that is not inconsistent with such direction.



     Notwithstanding the rights of Noteholders set forth in this Section
5.11, subject to Section 6.01, the Indenture Trustee need not take
any action that it determines might involve it in liability or might materially
adversely affect the rights of any Noteholders or Hedge Counterparties not
consenting to such action.



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     Section 5.12 Waiver of Past Defaults.



     Prior to the declaration of the acceleration of the maturity of the Notes
as provided in Section 5.02, the Majority Noteholders may waive any past
Event of Default and its consequences except an Event of Default with respect
to payment of principal of or interest on any of the Notes or in respect of a
covenant or provision hereof which cannot be modified or amended without the
consent of the Holder of each Note. In the case of any such waiver, the
Issuer, the Indenture Trustee and the Noteholders shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other Event of Default or impair any right
consequent thereto.



     Upon any such waiver, any Event of Default arising therefrom shall be
deemed to have been cured and not to have occurred, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Event of
Default or impair any right consequent thereto. No such waiver shall affect a
Hedge Agreement or any Hedge Transaction that has been terminated in accordance
with its terms.



     Section 5.13 Undertaking for Costs.



     All parties to this Indenture agree, and each Holder of any Note by such
Holder’s acceptance thereof shall be deemed to have agreed, that any court may
in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against
the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys’ fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 5.13 shall not apply to (a) any suit
instituted by the Indenture Trustee, (b) any suit instituted by any Noteholder,
or group of Noteholders, in each case holding in the aggregate more than 25% of
the Aggregate Outstanding Principal Balance or (c) any suit instituted by any
Noteholder for the enforcement of the payment of principal of or interest on
any Note on or after the respective due dates expressed in such Note and in
this Indenture.



     Section 5.14 Waiver of Stay or Extension Laws.



     The Issuer covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead or in any manner whatsoever, claim
or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, that may affect the covenants
or the performance of this Indenture; and the Issuer (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of
any power herein granted to the Indenture Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.



     Section 5.15 Sale of Indenture Collateral.



     (a) The power to effect any sale or other disposition (a “Sale”) of
any portion of a Indenture Collateral pursuant to Section 5.04 is
expressly subject to the provisions of



51









 







Section 5.05 and this Section
5.15. The power to effect any such Sale shall not be exhausted by any one
or more Sales as to any portion of the Indenture Collateral remaining unsold,
but shall continue unimpaired until the entire Indenture Collateral shall have
been sold or all amounts payable on the Notes and under this Indenture shall
have been paid. The Indenture Trustee hereby expressly waives its right to any
amount fixed by law as compensation for any Sale.



     (b) The Indenture Trustee shall not in any private Sale sell the Indenture
Collateral, or any portion thereof, unless the Holders of all the Class A-1
Notes, Class A-2 Notes, Class B Notes, Class C Notes and Class D Notes, and
each Hedge Counterparty consent to or direct the Indenture Trustee to make such
Sale and:




     (i) the proceeds of such Sale would be not less than the entire
amount which would be payable to the Noteholders under the Notes and the
Hedge Counterparties under the Hedge Agreements, in full payment thereof
(including all Hedge Breakage Costs and other amounts payable in
connection with the termination of the Hedge Agreements) on the
Remittance Date next succeeding the date of such Sale, or




     (ii) the Indenture Trustee determines, in its sole discretion, that
the conditions for retention of the Indenture Collateral set forth in
Section 5.05 cannot be satisfied (in making any such
determination, the Indenture Trustee may rely upon an
opinion of an Independent investment banking or accounting firm
obtained and delivered as provided in Section 5.05, and the
Majority Noteholders consent to such Sale, which consent will not be
unreasonably withheld).



     (c) In connection with a Sale of all or any portion of the Indenture
Collateral:




     (i) any Holder or Holders of Notes may bid for and purchase the
property offered for Sale, and upon compliance with the terms of Sale may
hold, retain and possess and dispose of such property, without further
accountability, and may, in paying the purchase money therefor, deliver
any Notes or claims for interest thereon in lieu of cash up to the amount
which shall, upon distribution of the net proceeds of such Sale, be
payable thereon, and such Notes, in case the amounts so payable thereon
shall be less than the amount due thereon, shall be returned to the
Holders thereof after being appropriately stamped to show such partial
payment;




     (ii) the Indenture Trustee may bid for and acquire the property
offered for Sale in connection with any Sale thereof, and, subject to any
requirements of, and to the extent permitted by, Requirements of Law in
connection therewith, may purchase all or any portion of the Indenture
Collateral in a private sale, and, in lieu of paying cash therefor, may
make settlement for the purchase price by crediting the gross Sale price
against the sum of (A) the amount which would be distributable to the
Holders of the Notes and Hedge Counterparties as a result of such Sale in
accordance with subsection 5.04(b) on the Remittance Date next
succeeding the date of such Sale and (B) the expenses of the Sale and of
any Proceedings in connection therewith which are reimbursable to it,
without being required to produce the Notes in order to complete any such
Sale or in order for the net Sale price to be credited against such
Notes, and any property so



52









 






acquired by the Indenture Trustee shall be
held and dealt with by it in accordance with the provisions of this
Indenture;




     (iii) the Indenture Trustee shall execute and deliver an appropriate
instrument of conveyance transferring its interest in any portion of the
Indenture Collateral in connection with a Sale thereof;




     (iv) the Indenture Trustee is hereby irrevocably appointed the agent
and attorney–in–fact of the Issuer to transfer and convey its interest in
any portion of the Indenture Collateral in connection with a Sale
thereof, and to take all action necessary to effect such Sale; and




     (v) no purchaser or transferee at such a Sale shall be bound to
ascertain the Indenture Trustee’s authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
moneys.



     Section 5.16 Action on Notes.



     The Indenture Trustee’s right to seek and recover judgment on the Notes or
under this Indenture shall not be affected by the seeking, obtaining or
application of any other relief under or with respect to this Indenture.
Neither the lien of this Indenture nor any rights or remedies of the Indenture
Trustee, the Hedge Counterparties or the Noteholders shall be impaired by the
recovery of any judgment by the Indenture Trustee against the Issuer or by
the levy of any execution under such judgment upon any portion of the Indenture
Collateral or upon any of the assets of the Issuer. Any money or property
collected by the Indenture Trustee shall be applied in accordance with
subsection 5.04(b).



     Section 5.17 Performance and Enforcement of Certain Obligations.



     (a) Promptly following a request from the Indenture Trustee to do so, the
Issuer shall take all such lawful action as the Indenture Trustee may request
to compel or secure the performance and observance by the Trust Depositor and
the Servicer, as applicable, of each of their obligations to the Issuer under
or in connection with the Transaction Documents, and to exercise any and all
rights, remedies, powers and privileges lawfully available to the Issuer under
or in connection with the Transaction Documents to the extent and in the manner
directed by the Indenture Trustee, including the transmission of notices of
default on the part of the Trust Depositor or the Servicer thereunder and the
institution of legal or administrative actions or proceedings to compel or
secure performance by the Trust Depositor or the Servicer of each of their
obligations under the Transaction Documents.



     (b) If a Servicer Default has occurred and is continuing, the Indenture
Trustee, at the direction (which direction shall be in writing or by telephone
(confirmed in writing promptly thereafter)) of (i) prior to the payment in full
of the Class A-1 Notes, the Class A-2 Notes, the Class B Notes, the Class C
Notes and the Class D Notes, the Class A-1 Noteholders evidencing 66 2/3% of
the aggregate Outstanding Principal Balance of all Class A-1 Notes, the Class
A-2 Noteholders evidencing 66 2/3% of the aggregate Outstanding Principal
Balance of all Class A-2 Notes, the Class B Noteholders evidencing 66 2/3% of
the aggregate Outstanding Principal Balance of all Class B Notes, the Class C
Noteholders evidencing 66 2/3% of the aggregate



53









 







Outstanding Principal Balance
of all Class C Notes, and the Class D Noteholders evidencing 66 2/3% of the
aggregate Outstanding Principal Balance of all Class D Notes consents thereto
and (ii) from and after the payment in full of the Class A-1 Notes, the Class
A-2 Notes, the Class B Notes, the Class C Notes, the Class D Notes, the Class E
Noteholders evidencing 66 2/3% of the aggregate Outstanding Principal Balance
of the Class E Note consents thereto, shall exercise all rights, remedies,
powers, privileges and claims of the Issuer against the Servicer under or in
connection with the Sale and Servicing Agreement, including the right or power
to take any action to compel or secure performance or observance by the
Servicer, of its obligations to the Issuer thereunder and to give any consent,
request, notice, direction, approval, extension or waiver under the Sale and
Servicing Agreement, and any right of the Issuer to take such action shall not
be suspended.



ARTICLE VI




THE INDENTURE TRUSTEE




     Section 6.01 Duties of Indenture Trustee.



     (a) If an Event of Default has occurred and is continuing, the Indenture
Trustee shall exercise the rights and powers vested in it by this Indenture and
use the same degree of care and
skill in their exercise as a prudent person would exercise or use under
the circumstances in the conduct of such person’s own affairs with respect to
the Indenture Collateral.



     (b) Except during the continuance of an Event of Default:




     (i) the Indenture Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and no
implied covenants or obligations shall be read into this Indenture
against the Indenture Trustee; and




     (ii) in the absence of bad faith on its part, the Indenture Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; however, the Indenture Trustee shall
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.



     (c) The Indenture Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:




     (i) this paragraph does not limit the effect of paragraph (b)
of this Section 6.01;




     (ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is proved
that the Indenture Trustee was negligent in ascertaining the pertinent
facts; and



54









 






     (iii) the Indenture Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 5.11.



     (d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to paragraphs (a), (b), (c)
and (g) of this Section 6.01.



     (e) The Indenture Trustee shall not be liable for interest on any money
received by it except as the Indenture Trustee may agree in writing with the
Issuer.



     (f) Money held in trust by the Indenture Trustee need not be segregated
from other funds except to the extent required by law or the terms of this
Indenture or the Sale and Servicing Agreement.



     (g) The Indenture Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture, to expend or risk its own
funds or otherwise incur financial liability or to honor the request or
direction of any of the Noteholders pursuant to this Indenture, unless the
Noteholders shall have offered to the Indenture Trustee reasonable security or
indemnity against the costs, expenses, and liabilities that might be incurred
by it in compliance with the request or direction.



     (h) Every provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Indenture Trustee shall be
subject to the provisions of this Section 6.01.



     (i) The Indenture Trustee shall not be deemed to have notice of any Event
of Default unless a Responsible Officer assigned to and working in the
Indenture Trustee’s Corporate Trust Office has actual knowledge thereof.



     Section 6.02 Rights of Indenture Trustee.



     (a) The Indenture Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The
Indenture Trustee need not investigate any fact or matter stated in the
document.



     (b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer’s Certificate, or, with respect to legal matters, an Opinion
of Counsel. The Indenture Trustee shall not be liable for any action it takes
or omits to take in good faith in reliance on an Officer’s Certificate or
Opinion of Counsel.



     (c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Indenture Trustee shall
not be responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.



     (d) The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however,



55









 







that the Indenture Trustee’s
conduct does not constitute willful misconduct, negligence or bad faith.



     (e) The Indenture Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture and
the Notes shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it hereunder
in good faith and in accordance with the advice or opinion of such counsel.



     (f) The Indenture Trustee shall not be bound to make any investigation
into the performance of the Issuer or the Servicer under this Indenture or any
other Transaction Document or into the matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, note or other document, but the Indenture
Trustee, in its discretion, may make any further inquiry or investigation into
those matters that it deems appropriate, and if the Indenture Trustee
determines to inquire further, it shall be entitled to examine the books,
records and premises of the Issuer and the Servicer, personally or by agent or
attorney.



     (g) If the Indenture Trustee is also acting as Paying Agent or as Note
Registrar, the rights and protections afforded to the Indenture Trustee
pursuant to the Article shall also be afforded to it in such additional
capacities.



     Section 6.03 Individual Rights of Indenture Trustee.



     The Indenture Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Indenture Trustee.
Any Note Registrar, co–registrar, Paying Agent or co–paying agent may do the
same with like rights. However, the Indenture Trustee must comply with
Section 6.11.



     Section 6.04 Indenture Trustee’s Disclaimer.



     The Indenture Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture, the Sale and
Servicing Agreement, the Trust Agreement or any other Transaction Document, the
validity or sufficiency of any security interest intended to be created or the
characterization of the Notes for tax purposes or the Notes, it shall not be
accountable for the Issuer’s use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in the Indenture or in any
document issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee’s certificate of authentication.



     Section 6.05 Notice of Event of Default.



     The Indenture Trustee shall mail to each Noteholder, each Hedge
Counterparty and the Owner Trustee notice of an Event of Default within 30 days
after the Indenture Trustee has actual knowledge thereof in accordance with
Section 6.01. Except in the case of an Event of Default in payment of
principal of or interest on any Note, the Indenture Trustee may withhold the
notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Noteholders and
the Hedge Counterparties.



56









 





     Section 6.06 Reports by Indenture Trustee to Holders.



     The Indenture Trustee shall deliver to each Noteholder such information as
may be required to enable such holder to prepare its federal and state income
tax returns. In addition, upon the Issuer’s or a Noteholder’s written request,
the Indenture Trustee shall promptly furnish information reasonably requested
by the Issuer or such Noteholder that is reasonably available to the Indenture
Trustee to enable the Issuer or such Noteholder to perform its federal and
state income tax reporting obligations.



     The Indenture Trustee shall not be responsible for any tax reporting,
disclosure, record keeping or list maintenance requirements of the Issuer under
Internal Revenue Code sections 6011(a), 6111(d) or 6112, including, but not
limited to, the preparation of IRS Form 8886 pursuant to Treasury Regulations
Section 1.6011-4(d) or any successor provision and any required list
maintenance under Treasury Regulations Section 301.6112-1 or any successor
provision.



     Section 6.07 Compensation and Indemnity.



     The Issuer shall or shall cause the Trust Depositor to pay to the
Indenture Trustee on each Remittance Date such reasonable compensation for its
services pursuant to a separate agreement
between the Indenture Trustee and the Trust Depositor. The Indenture
Trustee’s compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuer shall or shall cause the Trust
Depositor to reimburse the Indenture Trustee for all reasonable out–of–pocket
expenses incurred or made by it, including costs of collection, in addition to
the compensation for its services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the Indenture
Trustee’s agents, counsel, accountants and experts. The Issuer shall or shall
cause the Trust Depositor to indemnify the Indenture Trustee against any and
all loss, liability or expense (including attorneys’ fees) incurred by it in
connection with the administration of this trust and the performance of its
duties hereunder. The Indenture Trustee shall notify the Issuer and the Trust
Depositor promptly of any claim for which it may seek indemnity. Failure by
the Indenture Trustee to so notify the Issuer and the Trust Depositor shall not
relieve the Issuer or the Trust Depositor of its obligations hereunder or under
the Trust Agreement. Neither the Issuer nor the Trust Depositor need reimburse
any expense or indemnify against any loss, liability or expense incurred by the
Indenture Trustee through the Indenture Trustee’s own willful misconduct,
negligence or bad faith.



     The Issuer’s payment obligations to the Indenture Trustee pursuant to this
Section 6.07 shall survive the discharge of this Indenture. When the
Indenture Trustee incurs expenses after the occurrence of an Event of Default
specified in clauses (iv) or (v) of the definition of “Event of
Default” with respect to the Issuer, the expenses are intended to constitute
expenses of administration under Title 11 of the United States Code or any
other applicable federal or state bankruptcy, insolvency or similar law.



     Section 6.08 Replacement of Indenture Trustee.



     No resignation or removal of the Indenture Trustee and no appointment of a
successor Indenture Trustee shall become effective until the acceptance of
appointment by the successor



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Indenture Trustee pursuant to this Section
6.08. The Indenture Trustee may resign at any time by so notifying the
Issuer. The Majority Noteholders or the Issuer, with the written consent of
the Majority Noteholders, may remove the Indenture Trustee by so notifying the
Indenture Trustee and the Rating Agencies in writing and may appoint a
successor Indenture Trustee. The Issuer shall remove the Indenture Trustee if:




     (i) the Indenture Trustee fails to comply with Section 6.11;




     (ii) the Indenture Trustee is adjudged a bankrupt or insolvent;




     (iii) a receiver or other public officer takes charge of the
Indenture Trustee or its property;




     (iv) the Indenture Trustee otherwise becomes incapable of acting; or




     (v) the Indenture Trustee defaults in any of its obligations under
the Transaction Documents and such default is not cured within 30 days
after a Responsible Officer of the Indenture Trustee receives written
notice of such default.



     If the Indenture Trustee resigns or is removed or if a vacancy exists in
the office of Indenture Trustee for any reason (the Indenture Trustee in such
event being referred to herein as the retiring Indenture Trustee), the Issuer
shall promptly appoint a successor Indenture Trustee.



     A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer. Thereupon the
resignation or removal of the retiring Indenture Trustee shall become
effective, and the successor Indenture Trustee shall have all the rights,
powers and duties of the Indenture Trustee under this Indenture. No successor
Indenture Trustee shall accept appointment as provided in this Section
6.08 unless at the time of such acceptance such Person shall be eligible
under the provisions of Section 6.11. The successor Indenture Trustee
shall mail a notice of its succession to Noteholders and the Hedge
Counterparties. The retiring Indenture Trustee shall promptly transfer all
property (including all Indenture Collateral) held by it as Indenture Trustee
to the successor Indenture Trustee and shall execute and deliver such
instruments and such other documents as may reasonably be required to more
fully and certainly vest and confirm in the successor Indenture Trustee all
such rights, powers, duties and obligations.



     If a successor Indenture Trustee does not take office within 60 days after
the retiring Indenture Trustee resigns or is removed, the retiring Indenture
Trustee, the Issuer or the Majority Noteholders, may petition any court of
competent jurisdiction for the appointment of a successor Indenture Trustee.



     If the Indenture Trustee fails to comply with Section 6.11, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.



     Notwithstanding the replacement of the Indenture Trustee pursuant to this
Section 6.08, the Issuer’s obligations under Section 6.07 shall
continue for the benefit of the retiring Indenture Trustee.



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     Upon acceptance of appointment by a successor Indenture Trustee as
provided in this Section 6.08, the Servicer shall mail notice of such
succession hereunder to all Holders of Notes at their addresses as shown in the
Note Register and the Hedge Counterparties at their addresses as shown on the
register kept by the Issuer, as provided to the Indenture Trustee. If the
Servicer fails to mail such notice within 10 days after acceptance of
appointment by the successor Indenture Trustee, the successor Indenture Trustee
shall cause such notice to be mailed at the expense of the Servicer.



     Section 6.09 Successor Indenture Trustee by Merger.



     If the Indenture Trustee consolidates with, merges or converts into, or
transfers all or substantially all its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or
transferee corporation without any further act shall be the successor Indenture
Trustee; provided, that, such corporation or banking association
shall be otherwise qualified and eligible under Section 6.11. The
Indenture Trustee shall provide the Rating Agencies and the Hedge
Counterparties prior written notice of any such transaction.



     In case at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the
certificate of authentication of any predecessor trustee, and deliver such
Notes so authenticated; and in case at that time any of the Notes shall not
have been authenticated, any successor to the Indenture Trustee may
authenticate such Notes either in the name of any predecessor hereunder or in
the name of the successor to the Indenture Trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the Notes or in
this Indenture provided that the certificate of the Indenture Trustee shall
have.



     Section 6.10 Appointment of Co–Indenture Trustee or Separate Indenture Trustee.



     (a) Notwithstanding any other provisions of this Indenture, at any time,
for the purpose of meeting any legal requirement of any jurisdiction in which
any part of the Indenture Collateral may at the time be located, the Indenture
Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons, to act as a co–trustee or co–trustees, or separate
trustee or separate trustees, of all or any part of the Indenture Collateral,
and to vest in such Person or Persons, in such capacity and for the benefit of
the Noteholders and the Hedge Counterparties, such interest to the Indenture
Collateral, or any part hereof, and, subject to the other provisions of this
Section 6.10, such powers, duties, obligations, rights and trusts as the
Indenture Trustee may consider necessary or desirable. No co–trustee or
separate trustee hereunder shall be required to meet the terms of eligibility
as a successor Indenture Trustee under Section 6.11 and no notice to the
Noteholders or the Hedge Counterparties of the appointment of any co–trustee or
separate trustee shall be required under Section 6.08 hereof. No
appointment of a co–trustee or a separate trustee shall relieve the Indenture
Trustee of its duties and obligations hereunder.



     (b) Every separate trustee and co–trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and
conditions:



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     (i) all rights, powers, duties and obligations conferred or imposed
upon the Indenture Trustee shall be conferred or imposed upon and
exercised or performed by the Indenture Trustee and such separate trustee
or co–trustee jointly (it being understood that such separate trustee or
co–trustee is not authorized to act separately without the Indenture
Trustee joining in such act), except to the extent that under any law of
any jurisdiction in which any particular act or acts are to be performed
the Indenture Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Indenture Collateral or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co–trustee, but solely at
the direction of the Indenture Trustee;




     (ii) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder; and




     (iii) the Indenture Trustee may at any time accept the resignation
of or remove any separate trustee or co–trustee.



     (c) Any notice, request or other writing given to the Indenture Trustee
shall be deemed to have been given to each of the then separate trustees and
co–trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co–trustee shall refer to this Indenture and
the conditions of this Article VI. Each separate trustee and
co–trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Indenture Trustee or separately, as may be provided therein,
subject to all the provisions of this Indenture, specifically including every
provision of this Indenture relating to the conduct of, affecting the liability
of, or affording protection to, the Indenture Trustee. Every such instrument
shall be filed with the Indenture Trustee.



     (d) Any separate trustee or co–trustee may at any time constitute the
Indenture Trustee, its agent or attorney–in–fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect
of this Indenture on its behalf and in its name. If any separate trustee or
co–trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.



     Section 6.11 Eligibility; Disqualification.



     The Indenture Trustee hereunder shall at all times be (i) a national
banking association or banking corporation or trust company organized and doing
business under the laws of any state or the United States, (ii) authorized
under such laws to exercise corporate trust powers, (iii) having a combined
capital and surplus of at least $50,000,000, (iv) having unsecured and
unguaranteed long–term debt obligations rated at least Baa3 by Moody’s, BBB by
Fitch and BBB– by S&P, and (v) is subject to supervision or examination by
federal or state authority. If such banking association publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of



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this
Section 6.11 its combined capital and surplus shall be deemed to be as
set forth in its most recent report of condition so published. In case at any
time the Indenture Trustee shall cease to be eligible in accordance with the
provisions of this Section 6.11, the Indenture Trustee shall (a) give
prompt notice to the Issuer, the Trust Depositor, the Servicer, the Noteholders
and the Hedge Counterparties that it has so ceased to be eligible to be the
Indenture Trustee and (b) resign, upon the request of the Majority Noteholders
in the manner and with the effect specified in Section 6.08.



     Section 6.12 Representations, Warranties and Covenants of Indenture
Trustee.



     The Indenture Trustee hereby makes the following representations,
warranties and covenants on which the Issuer, the Trust Depositor, the
Servicer, the Noteholders and the Hedge Counterparties shall rely:



     (a) the Indenture Trustee is a national banking association and trust
company duly organized, validly existing and in good standing under the laws of
the United States.



     (b) The Indenture Trustee has full power, authority and legal right to
execute, deliver and perform this Indenture and the other Transaction Documents
to which it is a party and shall have taken all necessary action to authorize
the execution, deliver and performance by it of this Indenture and the other
Transaction Documents to which it is a party.



     (c) The execution, delivery and performance by the Indenture Trustee of
this Indenture and the other Transaction Documents to which it is a party shall
not (i) violate any provision of any law or any order, writ, judgment or decree
of any court, arbitrator or governmental authority applicable to the Indenture
Trustee or any of its assets, (ii) violate any provision of the corporate
charter or by–laws of the Indenture Trustee or (iii) violate any provision of,
or constitute, with or without notice or lapse of time, a default under, or
result in the creation or imposition of any lien on any properties included in
the Indenture Collateral pursuant to the provisions of, any mortgage,
indenture, contract, agreement or other undertaking to which it is a party,
which violation, default or lien could reasonably be expected to materially and
adversely affect the Indenture Trustee’s performance or ability to perform its
duties under this Indenture and the other Transaction Documents to which it is
a party or the transactions contemplated in this Indenture and the other
Transaction Documents to which it is a party.



     (d) The execution, delivery and performance by the Indenture Trustee of
this Indenture and the other Transaction Documents to which it is a party shall
not require the authorization, consent or approval of, the giving of notice to,
the filing or registration with or the taking of any other action in respect of
any governmental authority or agency regulating the banking and corporate trust
activities of the Indenture Trustee.



     (e) This Indenture and the other Transaction Documents to which it is a
party has been duly executed and delivered by the Indenture Trustee and
constitute the legal, valid and binding agreements of the Indenture Trustee,
enforceable in accordance with their respective terms, subject to the effect of
bankruptcy, insolvency, reorganization, moratorium and other similar laws
relating to or affecting creditors’ rights generally or the application of
equitable principles in any proceeding, whether at law or in equity. The
Indenture Trustee hereby agrees



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and covenants that it will not at any time in
the future, deny that this Indenture and the other Transaction Documents to
which it is a party constitute the legal, valid and binding agreement of the
Indenture Trustee.



     (f) The Indenture Trustee shall not take any action, or fail to take any
action, if such action or failure to take action will materially interfere with
the enforcement of any rights of the Noteholders or the Hedge Counterparties
under this Indenture or the other Transaction Documents.



     Section 6.13 Directions to Indenture Trustee.



     The Indenture Trustee is hereby directed:




     (i) to accept a collateral assignment of the Loans and hold the
assets of the Indenture Collateral as security for the Noteholders and
Hedge Counterparties;




     (ii) to authenticate and deliver the Notes substantially in the form
prescribed by Exhibit A in accordance with the terms of this
Indenture;




     (iii) to execute and deliver the Transaction Documents to which it
is a party; and




     (iv) to take all other actions as shall be required to be taken by
the terms of this Indenture.



     Section 6.14 Conflicts.



     If a Default occurs and is continuing and the Indenture Trustee is deemed
to have a “conflicting interest” (as defined in the TIA) as a result of acting
as trustee for the Class A-1 Notes, the Class A-2 Notes, the Class B Notes, the
Class C Notes, the Class D Notes and the Class E Note, the Issuer shall appoint
a successor Indenture Trustee for the Class A-1 Notes, the Class A-2 Notes, the
Class B Notes, the Class C Notes and the Class D Notes and a successor for the
Class E Note so that there will be separate Indenture Trustees for the Class
A-1 Notes, the Class A-2 Notes, the Class B Notes, the Class C Notes and the
Class D Notes on the one hand, and for the Class E Note on the other hand. No
such event shall alter the voting rights of the Noteholders under this
Indenture or under any of the other Transaction Documents.



ARTICLE VII




NOTEHOLDERS’ LISTS AND REPORTS




     Section 7.01 Issuer To Furnish Indenture Trustee Names and Addresses
of Noteholders.



     The Issuer will furnish or cause to be furnished to the Indenture Trustee
(a) within one (1) day after each Record Date, a list, in such form as the
Indenture Trustee may reasonably require, of the names and addresses of the
Holders of Notes as of such Record Date and (b) at such other times as the
Indenture Trustee may reasonably request in writing, within 30 days after
receipt by



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the Issuer of any such request, a list of similar form and content
as of a date not more than ten (10) days prior to the time such list is
furnished; provided, however, that so long as the Indenture
Trustee is the Note Registrar, no such list shall be required to be furnished.



     Section 7.02 Preservation of Information; Communications to
Noteholders.



     (a) The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as
provided in Section 7.01 and the names and addresses of Holders of Notes
received by the Indenture Trustee in its capacity as Note Registrar. The
Indenture Trustee may destroy any list furnished to it as provided in such
Section 7.01 upon receipt of a new list so furnished.



     (b) Noteholders may communicate pursuant to TIA § 312(b) with other
Noteholders with respect to their rights under this Indenture or under the
Notes.



     (c) The Issuer, the Indenture Trustee and the Note Registrar shall have
the protection of TIA § 312(c).



     (d) The Indenture Trustee shall furnish to the Noteholders and the Hedge
Counterparties promptly upon receipt of a written request therefor, duplicates
or copies of all reports, notices, requests, demands, certificates, financial
statements and any other instruments furnished to the Indenture Trustee under
the Transaction Documents.



     Section 7.03 Fiscal Year.



     Unless the Issuer otherwise determines, the fiscal year of the Issuer
shall end on December 31 of each year.



     Section 7.04 Reports to Irish Stock Exchange, Etc.



     In the event of a change in the Indenture Trustee, any paying agent or any
transfer agent in Ireland, the Issuer will cause notification thereof to be
published in the Irish Stock Exchange’s Daily Official List or as otherwise
required by the rules of the Irish Stock Exchange.



ARTICLE VIII




TRUST ACCOUNTS, DISBURSEMENTS AND RELEASES




     Section 8.01 Collection of Money.



     Except as otherwise expressly provided herein, the Indenture Trustee may
demand payment or delivery of, and shall receive and collect, directly and
without intervention or assistance of any fiscal agent or other intermediary,
all money and other property payable to or receivable by the Indenture Trustee
pursuant to this Indenture. The Indenture Trustee shall apply all such money
received by it as provided in this Indenture. Except as otherwise expressly
provided in this Indenture, if any Event of Default occurs in the making of any
payment or performance under any agreement or instrument that is part of the
Indenture Collateral, the



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Indenture Trustee may take such action as may be
appropriate to enforce such payment or performance, including the institution
and prosecution of appropriate Proceedings. Any such action shall be without
prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.



     Section 8.02 Trust Accounts.




     (a) On or prior to the Closing Date, the Servicer shall establish and
maintain, in the name of the Indenture Trustee, for the benefit of the
Noteholders, the Hedge Counterparties, and the Certificateholder, the Trust
Accounts (other than the Principal and Interest Accounts which shall be in the
name of the Servicer) as provided in Section 7.01 of the Sale and
Servicing Agreement.



     (b) All funds required to be deposited in the Principal and Interest
Account with respect to the preceding Due Period will be deposited in the
Principal and Interest Account as provided in Section 7.01 of the Sale
and Servicing Agreement. On or before each
Determination Date, the Collections with respect to the preceding Due
Period will be transferred from the Principal and Interest Account to the Note
Distribution Account as provided in Section 7.05 of the Sale and
Servicing Agreement.



     (c) On each Remittance Date, the Indenture Trustee shall distribute all
amounts on deposit in the Note Distribution Account to Noteholders in respect
of each Class of Notes, to the Hedge Counterparties in respect of the Hedge
Agreements, and to the Paying Agent under the Trust Agreement, for distribution
to the Holders of the Trust Certificates in accordance with the provisions of
Section 7.05 of the Sale and Servicing Agreement.



     (d) All moneys deposited from time to time in the Note Distribution
Account pursuant to the Sale and Servicing Agreement and all deposits therein
pursuant to this Indenture are for the benefit of the Noteholders and the Hedge
Counterparties and all investments made with such moneys including all income
or other gain from such investments are for the benefit of the Noteholders and
the Hedge Counterparties as provided by the Sale and Servicing Agreement.



     (e) The proceeds of any purchase or sale of the assets of the Issuer
described in Section 10.01 hereof shall be deposited in the Note
Distribution Account.



     The Indenture Trustee shall invest any funds in the Note Distribution
Account as provided in the Sale and Servicing Agreement.



     Section 8.03 Opinion of Counsel.



     Except for releases or conveyances required or permitted by the Sale and
Servicing Agreement and the other Transaction Documents, the Indenture Trustee
shall receive at least two (2) Business Days’ notice when requested by the
Issuer to take any action pursuant to subsection 8.05(a), accompanied by
copies of any instruments to be executed, and the Indenture Trustee shall also
require, as a condition to such action, an Opinion of Counsel, in form and
substance satisfactory to the Indenture Trustee, stating the legal effect of
any such action, outlining the steps required to complete the same, and
concluding that all conditions precedent to the taking of such action have been
complied with and such action will not materially and



64









 







adversely impair the
security for the Notes or the Hedge Agreements or the rights of the Noteholders
and the Hedge Counterparties in contravention of the provisions of this
Indenture; provided, however, that such Opinion of Counsel shall
not be required to express an opinion as to the fair value of the Indenture
Collateral. Counsel rendering any such opinion may rely as to factual matters,
without independent investigation, on the accuracy and validity of any
certificate or other instrument delivered to the Indenture Trustee in
connection with any such action.



     Section 8.04 Termination Upon Distribution to Noteholders.



     This Indenture and the respective obligations and responsibilities of the
Issuer and the Indenture Trustee created hereby shall terminate upon the
distribution to the Noteholders, the Hedge Counterparties and the Indenture
Trustee of all amounts required to be distributed pursuant to Article
III and the Sale and Servicing Agreement.



     Section 8.05 Release of Indenture Collateral.



     (a) Subject to the payment of its fees and reasonable expenses, the
Indenture Trustee may, and when required by the provisions of this Indenture
shall, execute instruments to release property from the lien of this Indenture,
or convey the Indenture Trustee’s interest in the same, in a manner and under
circumstances that are not inconsistent with the provisions of this Indenture,
Section 5.08 of the Sale and Servicing Agreement and the other
Transaction Documents. No party relying upon an instrument executed by the
Indenture Trustee as provided in Article IV hereunder shall be bound to
ascertain the Indenture Trustee’s authority, inquire into the satisfaction of
any conditions precedent, or see to the application of any moneys.



     (b) The Indenture Trustee shall, at such time as (i) there are no Notes
Outstanding, (ii) all outstanding Hedge Transactions under all Hedge Agreements
then in effect have been terminated and all payments payable to the Hedge
Counterparties in connection with such termination have been paid in full, and
(iii) all sums due the Indenture Trustee pursuant to this Indenture have been
paid, release any remaining portion of the Indenture Collateral that secured
the Notes from the lien of this Indenture. The Indenture Trustee shall release
property from the lien of this Indenture pursuant to this subsection
8.05(b) only upon receipt of a request from the Issuer accompanied by an
Officer’s Certificate and an Opinion of Counsel stating that all conditions
precedent to such release have been satisfied.



     Section 8.06 Surrender of Notes Upon Final Payment.



     By acceptance of any Note, the Holder thereof agrees to surrender such
Note to the Indenture Trustee promptly, prior to such Noteholder’s receipt of
the final payment thereon.



ARTICLE IX




SUPPLEMENTAL INDENTURES




     Section 9.01 Supplemental Indentures Without Consent of
Noteholders.



     (a) Without the consent of the Holders of any Notes but with the prior
notice to the Rating Agencies, the Issuer and the Indenture Trustee, when
authorized by an Issuer Order, at



65









 







any time and from time to time, may enter
into one or more indentures supplemental, in form satisfactory to the Indenture
Trustee, for any of the following purposes:




     (i) to correct or amplify the description of any property at any
time subject to the lien of this Indenture, or better to assure, convey
and confirm unto the Indenture Trustee any property subject or required
to be subjected to the lien of this Indenture, or to subject to the lien
of this Indenture additional property;




     (ii) to evidence the succession, in compliance with the applicable
provisions hereof, of another person to the Issuer, and the assumption by
any such successor of the covenants of the Issuer herein and in the Notes
contained;




     (iii) to add to the covenants of the Issuer, for the benefit of the
Holders of the Notes and the Hedge Counterparties, or to surrender any
right or power herein conferred upon the Issuer;




     (iv) to convey, transfer, assign, mortgage or pledge any property to
or with the Indenture Trustee;




     (v) to cure any ambiguity, to correct or supplement any provision
herein or in any supplemental indenture that may be inconsistent with any
other provision herein or in any supplemental indenture or to make any
other provisions with respect to matters or questions arising under this
Indenture or in any supplemental indenture; provided, that,
such action shall not as evidenced by an Opinion of Counsel delivered to
the Indenture Trustee, adversely affect the interests of the Noteholders
or the Hedge Counterparties in any material respect;




     (vi) to evidence and provide for the acceptance of the appointment
hereunder by a successor trustee with respect to the Notes and to add to
or change any of the provisions of this Indenture as shall be necessary
to facilitate the administration of the trusts hereunder by more than one
trustee, pursuant to the requirements of Article VI;




     (vii) to add to the conditions, limitations and restrictions on the
authorized amount, terms and purposes of the issuance, authentication and
delivery of any Class of Notes, as herein set forth, additional
conditions, limitations and restrictions thereafter to be observed;




     (viii) to modify the restrictions on and procedures for resales and
other transfers of the Notes to reflect any changes in Applicable Law or
regulations (or the interpretation thereof) or to enable the Issuer or
the Indenture Trustee to rely upon the exemption from registration under
the Securities Act or the 1940 Act or to remove restrictions on resale or
transfer to the extent required hereunder;




     (ix) to make such amendments to this Indenture or the Notes (other
than an amendment of the type described in Section 9.02(i)-(viii)) as the
Issuer and the Indenture Trustee, in their reasonable discretion, may
deem necessary or advisable in order for the Class A-1 Notes, the Class
A-2 Notes, the Class B Notes, the Class C Notes and the Class D Notes to
qualify for or maintain their listing on the Irish Stock Exchange; and



66









 






     (x) to evidence or implement any change to this Indenture required
by regulations or guidelines enacted to support the USA PATRIOT Act.



     The Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.



     (b) The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, may, also without the consent of any of the Holders of the Notes but
with prior notice to the Rating Agencies, enter into an indenture or indentures
supplemental hereto for the purpose of adding
any provisions to, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes or any Hedge Counterparty under this Indenture;
provided, however, that such action shall not, as evidenced by an
Opinion of Counsel, (i) adversely affect in any material respect the interest
of any Noteholder or any Hedge Counterparty or (ii) cause the Issuer to be
subject to an entity level tax or be classified as a taxable mortgage pool
within the meaning of Section 7701(i) of the Code.



     (c) Notwithstanding any provision contained herein to the contrary, prior
to entering into any supplemental indenture pursuant to Section 9.01,
the Issuer and Indenture Trustee shall obtain written confirmation from Moody’s
that entry by the Issuer and Indenture Trustee into such supplemental indenture
satisfies the Moody’s Rating Condition.



     Section 9.02 Supplemental Indentures With Consent of Noteholders.



     The Issuer and the Indenture Trustee, when authorized by an Issuer Order,
also may, with prior notice to the Rating Agencies and with the consent of the
Majority Noteholders by Act of such Holders and the Hedge Counterparties, enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Note affected thereby:




     (i) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof, the
interest rate thereon or the Redemption Price with respect thereto,
change the provisions of this Indenture relating to the application of
collections on, or the proceeds of the sale of the Indenture Collateral
to payment of principal of or interest on the Notes, or change any place
of payment where, or the coin or currency in which, any Note or the
interest thereon is payable, or impair the right to institute suit for
the enforcement of the provisions of this Indenture requiring the
application of funds available therefor, as provided in Article V,
to the payment of any such amount due on the Notes on or after the
respective due dates thereof;




     (ii) reduce the percentage of the Aggregate Outstanding Principal
Balance, the consent of the Holders of which is required for any such
supplemental indenture, or the consent of the Holders of which is
required for any waiver of compliance with any provision of this
Indenture or defaults hereunder and their consequences provided for in
this Indenture;



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     (iii) modify or alter the provisions of the proviso to the
definition of the term “Outstanding” or modify or alter the exception in
the definition of the term “Holder”;




     (iv) reduce the percentage of the Aggregate Outstanding Principal
Balance required to direct the Indenture Trustee to direct the Issuer to
sell or liquidate the Indenture Collateral pursuant to Section
5.04;




     (v) modify any provision of this Section 9.02 except to
increase any percentage specified herein or to provide that certain
additional provisions of this
Indenture or the Transaction Documents cannot be modified or waived
without the consent of the Holder of each Note affected thereby;




     (vi) permit the creation of any lien ranking prior to or on a parity
with the lien of this Indenture with respect to any part of the Indenture
Collateral or, except as otherwise permitted or contemplated herein,
terminate the lien of this Indenture on any property at any time subject
hereto or deprive any Noteholder or any Hedge Counterparty of the
security provided by the lien of this Indenture; and provided,
further, that such action shall not, as evidenced by an Opinion of
Counsel, cause the Issuer to be subject to an entity level tax or be
classified as a taxable mortgage pool within the meaning of Section
7701(i) of the Code; or




     (vii) change the definition of Eligible Loan.



     Notwithstanding any provision contained herein to the contrary, in no
event may Section 3.32 of the Indenture be amended or modified in any
respect without the prior written consent of each Hedge Counterparty.



     The Indenture Trustee may in its discretion determine whether or not any
Notes would be affected by any supplemental indenture and any such
determination shall be conclusive upon the Holders of all Notes, whether
theretofore or thereafter authenticated and delivered hereunder. The Indenture
Trustee shall not be liable for any such determination made in good faith.



     It shall not be necessary for any Act of Noteholders or Hedge
Counterparties under this Section 9.02 to approve the particular form of
any proposed supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof.



     Promptly after the execution by the Issuer and the Indenture Trustee of
any supplemental indenture pursuant to this Section 9.02, the Indenture
Trustee shall mail to the Holders of the Notes and the Hedge Counterparties to
which such amendment or supplemental indenture relates a copy of such
supplemental Indenture or a notice setting forth in general terms the substance
of such supplemental indenture. Any failure of the Indenture Trustee to mail
such notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture.



     Notwithstanding any provision contained herein to the contrary, prior to
entering into any supplemental indenture pursuant to Section 9.02, the
Issuer and Indenture Trustee shall obtain written confirmation from Moody’s
that entry by the Issuer and Indenture Trustee into such supplemental indenture
satisfies the Moody’s Rating Condition.



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     Section 9.03 Execution of Supplemental Indentures.



     In executing, or permitting the additional trusts created by, any
supplemental indenture permitted by this Article IX or the modification
thereby of the trusts created by this Indenture, the Indenture Trustee shall be
entitled to receive, and subject to Sections 6.01 and 6.02, shall
be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture. The Indenture Trustee may, but shall not be obligated to, enter
into any such supplemental indenture
that affects the Indenture Trustee’s own rights, duties, liabilities or
immunities under this Indenture or otherwise. The Indenture Trustee shall
provide copies of each supplemental indenture to the Rating Agencies.



     Section 9.04 Effect of Supplemental Indenture.



     Upon the execution of any supplemental indenture pursuant to the
provisions hereof, this Indenture shall be and shall be deemed to be modified
and amended in accordance therewith with respect to the Notes affected thereby,
and the respective rights, limitations of rights, obligations, duties,
liabilities and immunities under this Indenture of the Indenture Trustee, the
Issuer and the Noteholders shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modifications and
amendments, and all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of this Indenture
for any and all purposes.



     Section 9.05 Reference in Notes to Supplemental Indentures.



     Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article IX may, and if required by the
Indenture Trustee shall, bear a notation in form approved by the Indenture
Trustee as to any matter provided for in such supplemental indenture. If the
Issuer or the Indenture Trustee shall so determine, new Notes so modified as to
conform, in the opinion of the Indenture Trustee and the Issuer, to any such
supplemental indenture may be prepared and executed by the Issuer and
authenticated and delivered by the Indenture Trustee in exchange for
Outstanding Notes.



ARTICLE X




OPTIONAL REDEMPTION OF NOTES




     Section 10.01 Optional Redemption.



     At any time when the Aggregate Outstanding Loan Balance is less than or
equal to 10% of the Initial Aggregate Outstanding Loan Balance, the Issuer may
redeem the Notes in whole, but not in part, at the direction of the Servicer
pursuant to Section 10.01 of the Sale and Servicing Agreement, on any
Remittance Date on which the Servicer exercises its option to purchase the Loan
Assets (other than the Trust Accounts) pursuant to said Section 10.01 by
depositing in full in the Note Distribution Account an amount equal to the
Redemption Price. If the Notes are to be redeemed pursuant to this Section
10.01, the Servicer or the Issuer shall furnish the Indenture Trustee and
the Rating Agencies notice of such redemption no later than 10 days prior to
the proposed Redemption Date and the Issuer shall deposit with the Indenture



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Trustee in the Note Distribution Account the Redemption Price of the Notes to
be redeemed and all Hedge Transactions then outstanding under any Hedge
Agreements then in effect shall be terminated and all amounts payable to the
Hedge Counterparties, including Hedge Breakage Costs, shall be paid in full on
the Redemption Date, and all such Notes shall be due and payable on the
Redemption Date upon the furnishing of a notice complying with Section
10.02 to each Holder of Notes.



     Section 10.02 Form of Redemption Notice.



     Notice of redemption under Section 10.01 shall be given by the
Indenture Trustee by facsimile, overnight courier or by first-class mail,
postage prepaid, transmitted or mailed prior to the applicable Redemption Date
to each Holder of Notes and to each Hedge Counterparty, as of the close of
business on the Record Date preceding the applicable Redemption Date, at such
Holder’s address appearing in the Note Register.



     All notices of redemption shall state:




     (i) the Redemption Date;




     (ii) the Redemption Price;




     (iii) that the Record Date otherwise applicable to such Redemption
Date is not applicable and that payments shall be made only upon
presentation and surrender of such Notes and the place where such Notes
are to be surrendered for payment of the Redemption Price (which shall be
the office or agency of the Issuer to be maintained as provided in
Section 3.02); and




     (iv) that interest on the Notes shall cease to accrue on the
Redemption Date.



     Notice of redemption of the Notes shall be given by the Indenture Trustee
in the name and at the expense of the Issuer. Failure to give notice of
redemption, or any defect therein, to any Holder of any Note shall not impair
or affect the validity of the redemption of any other Note.



     Section 10.03 Notes Payable on Redemption Date.



     The Notes to be redeemed shall, following notice of redemption as required
by Section 10.02, on the Redemption Date become due and payable at the
Redemption Price and no interest shall accrue on the Redemption Price for any
period after the date to which accrued interest is calculated for purposes of
calculating the Redemption Price.



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ARTICLE XI




MISCELLANEOUS




     Section 11.01 Compliance Certificates and Opinions, etc.




     (a) Upon any application or request by the Issuer to the Indenture Trustee
to take any action under any provision of this Indenture, the Issuer shall
furnish to the Indenture Trustee an Officer’s Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with, and, if required, an Opinion of
Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with, except that, in the case of any
such application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture, no additional
certificate or opinion need be furnished.



     Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:




     (i) a statement that each signatory of such certificate or opinion
has read or has caused to be read such covenant or condition and the
definitions herein relating thereto;




     (ii) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;




     (iii) a statement that, in the opinion of each such signatory, such
signatory has made such examination or investigation as is necessary to
enable such signatory to express an informed opinion as to whether or not
such covenant or condition has been complied with;




     (iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with; and




     (v) if the signer of such Trust Certificate or Opinion is required
to be Independent, the Statement required by the definition of the term
“Independent”.



     (b) (i) Prior to the deposit of any Indenture Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture,
the Issuer shall, in addition to any obligation imposed in subsection
11.01(a) or elsewhere in this Indenture, furnish to the Indenture Trustee
an Officer’s Certificate certifying or stating the opinion of each person
signing such certificate as to the estimated fair value (within 90 days of such
deposit) to the Issuer of the Indenture Collateral or other property or
securities to be so deposited.




     (ii) Subject to clause (iii), whenever any property or
securities are to be released from the lien of this Indenture, the Issuer
shall also furnish to the Indenture Trustee an Officer’s Certificate
certifying or stating the opinion of each person signing



71









 







such certificate
as to the estimated fair value (within ninety (90) days of such release)
of the property or securities proposed to be released and stating that in
the opinion of such person the proposed release will not impair the
security under this Indenture in contravention of the provisions hereof.




     (iii) Notwithstanding any provision of this Indenture, the Issuer
may, without compliance with the requirements of the other provisions of
this Section 11.01, (A) collect, sell or otherwise dispose of
Loans and Indenture Collateral as and to the extent permitted or required
by the Transaction Documents, or (B) make cash payments out of the Trust
Accounts.



     Section 11.02 Form of Documents Delivered to Indenture Trustee.



     In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or
covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.



     Any certificate or opinion of an Authorized Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows that the
certificate or opinion or representations with respect to the matters upon
which the certificate or opinion is based are erroneous. Any such certificate
of an Authorized Officer or Opinion of Counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Servicer, the Issuer, the
Trust Depositor, or other appropriate Person, stating that the information with
respect to such factual matters is in the possession of the Servicer, the
Issuer, the Trust Depositor or such other Person, unless such counsel knows
that the certificate or opinion or representations with respect to such matters
are erroneous.



     Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.



     Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer’s compliance with any term hereof, it is intended
that the truth and accuracy in all material respects, at the time of the
granting of such application or at the effective date of such certificate or
report (as the case may be), of the facts and opinions stated in such document
shall in such case be conditions precedent to the right of the Issuer to have
such application granted or to the sufficiency of such certificate or report.
The foregoing shall not, however, be construed to affect the Indenture
Trustee’s right to rely upon the truth and accuracy of any statement or opinion
contained in any such document as provided in Article VI.



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     Section 11.03 Acts of Noteholders.



     (a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Noteholders
may be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Noteholders in person or by agents duly appointed
in writing; and except as herein otherwise expressly provided such action shall
become effective when such instrument or instruments are delivered to the
Indenture Trustee, and, where it is hereby expressly required, to the Issuer.
Such instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the “Act” of the Noteholders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for
any purpose of this Indenture and (subject to Section 6.01) conclusive
in favor of the Indenture Trustee and the Issuer, if made in the manner
provided in this Section 11.03.



     (b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.



     (c) The ownership of Notes shall be proved by the Note Register.



     (d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Notes shall bind the Holder of every Note
issued upon the registration thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Note.



     Section 11.04 Notices, etc., to Indenture Trustee and Others.



     Any request, demand, authorization, direction, notice, consent, waiver or
Act of Noteholders or other documents provided or permitted by this Indenture
shall be in writing and if such request, demand, authorization, direction,
notice, consent, waiver or act of Noteholders is to be made upon, given or
furnished to or filed with:




     (i) the Indenture Trustee by any Noteholder or by the Issuer shall
be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Indenture Trustee and received at the
Corporate Trust Office, or




     (ii) the Issuer by the Indenture Trustee or by any Noteholder shall
be sufficient for every purpose hereunder if in writing and mailed
first–class, postage prepaid to the Issuer addressed to: CapitalSource
Commercial Loan Trust 2004-1, c/o Wilmington Trust Company, One Rodney
Square North, Wilmington, Delaware 19890, Attention: Corporate Trust
Administration, with a copy to CapitalSource Finance LLC at 4445 Willard
Avenue, 12th Floor, Chevy Chase, Maryland 20815, Attention: Controller,
or at any other address previously furnished in writing to the Indenture
Trustee by the Issuer, CapitalSource or the Trust Depositor. The Issuer
shall promptly transmit any notice received by it from the Noteholders to
the Indenture Trustee.



     Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered or mailed by certified mail, return



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receipt requested, to (i) in the
case of S&P, at the following address: Standard and Poor’s Rating Service, 55
Water Street, 41st Floor, New York, New York 10007, Attention: Surveillance:
Asset–Backed Services, (ii) in the case of Fitch, at the following address: 55
East Monroe Street, Suite 3500, Chicago, Illinois 60603, Attention: CDO
Surveillance, and (iii) in the case of Moody’s, at the following address:
Moody’s Investors Service, ABS Monitoring Department, 99 Church Street, New
York, New York 10007, cdomonitoring@moodys.com; or as to each of the foregoing,
at such other address as shall be designated by written notice to the other
parties; provided, however, that no notice shall be required to
be given to the Rating agencies until a Class of Notes has been rated by such
Rating Agency.



     Notices required to be given to any Hedge Counterparty by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered or mailed by certified mail, return receipt requested, to the notice
address shown in the register kept by the Issuer, as provided to the Indenture
Trustee.



     Section 11.05 Notices to Noteholders; Waiver.



     Where this Indenture provides for notice to Noteholders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, by nationally recognized overnight courier or by
first–class, postage prepaid to each Noteholder affected by such event, at his
address as it appears on the Note Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such notice.
In any case where notice to Noteholders is given by mail, neither the failure
to mail such notice nor any defect in any notice so mailed to any particular
Noteholder shall affect the sufficiency of such notice with respect to other
Noteholders, and any notice that is mailed in the manner herein provided shall
conclusively be presumed to have been duly given.



     Where this Indenture provides for notice in any manner, such notice may be
waived in writing by any Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Noteholders shall be filed with the Indenture Trustee but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such a waiver.



     In case, by reason of the suspension of regular mail service as a result
of a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Noteholders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be
a sufficient giving of such notice.



     Where this Indenture provides for notice to the Rating Agencies, failure
to give such notice shall not affect any other rights or obligations created
hereunder, and shall not under any circumstance constitute an Event of Default.



     In addition, for so long as any Class of Notes is listed on the Irish
Stock Exchange and the rules thereof so require, notices to Holders of such
Notes will also be given by publication in the Irish Stock Exchange’s Daily
Official List or as otherwise required by the rules of the Irish Stock
Exchange.



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     Section 11.06 Alternate Payment and Notice Provisions.



     Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Holder of a Note
providing for a method of payment, or notice by the Indenture Trustee or any
Paying Agent to such Holder, that is different from the methods provided for in
this Indenture for such payments or notices. The Issuer will furnish to the
Indenture Trustee a copy of each such agreement and the Indenture Trustee will
cause payments to be made and notices to be given in accordance with such
agreements.



     Section 11.07 Effect of Headings.



     The Article and Section headings herein are for convenience only and shall
not affect the construction hereof.



     Section 11.08 Successors and Assigns.



     All covenants and agreements in this Indenture and the Notes by the Issuer
shall bind its successors and assigns, whether so expressed or not. All
agreements of the Indenture Trustee in this Indenture shall bind its
successors, co–trustees and agents.



     Section 11.09 Severability.



     In case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.



     Section 11.10 Benefits of Indenture.



     Nothing in this Indenture or in the Notes, express or implied, shall give
to any Person, other than the parties hereto and their successors hereunder,
and the Noteholders, and any other party secured hereunder (including the Hedge
Counterparties), and any other Person with an ownership interest in any part of
the Indenture Collateral, any benefit or any legal or equitable right, remedy
or claim under this Indenture.



     Section 11.11 Legal Holidays.



     In any case where the date on which any payment is due shall not be a
Business Day, then (notwithstanding any other provision of the Notes or this
Indenture) payment need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date
on which nominally due, and no interest shall accrue for the period from and
after any such nominal date.



     Section 11.12 GOVERNING LAW.



     (a) THIS INDENTURE, EACH SUPPLEMENT AND THE NOTES SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE




75










 




OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.




     (b) EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS INDENTURE. Each party hereto (i) certifies that no representative, agent
or attorney of any other party has represented, expressly or otherwise, that
such other party would not, in the event of litigation, seek to enforce the
foregoing waiver and (ii) acknowledges that it and the other parties hereto
have been induced to enter into this Indenture by, among other things, the
mutual waivers and certifications in this subsection 11.12(b).



     Section 11.13 Counterparts.



     This Indenture may be executed in any number of counterparts (including by
facsimile), each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same
instrument.



     Section 11.14 Issuer Obligation.



     No recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under this Indenture or any certificate or other writing delivered in
connection herewith or therewith, against (i) the Indenture Trustee or the
Owner Trustee in its individual capacity, (ii) any owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, agent,
officer, director, employee or agent of the Indenture Trustee or the Owner
Trustee in its individual capacity, any holder of a beneficial interest in the
Issuer, the Owner Trustee or the Indenture Trustee or of any successor or
assign of the Indenture Trustee or the Owner Trustee in its individual
capacity, except as any such Person may have expressly agreed (it being
understood that the Indenture Trustee and the Owner Trustee have no such
obligations in their individual capacity) and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
For all purposes of this Indenture, in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee and the Trust Company
shall be subject to, and entitled to the benefits of, the terms and provisions
of the Trust Agreement.



     Section 11.15 No Petition.



     The Indenture Trustee, by entering into this Indenture, and each
Noteholder, by accepting a Note, hereby covenant and agree that they will not
prior to the date which is one (1) year and one (1) day after payment in full
of each Class of Notes rated by any Rating Agency, institute against the Trust
Depositor or the Issuer, or join in any institution against the Trust Depositor
or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any United States federal
or state bankruptcy or similar law in connection with any obligations relating
to the Notes, this Indenture or any of the Transaction Documents.



76









 





     Section 11.16 Inspection; Confidentiality.



     The Issuer agrees that, on reasonable prior notice, it will permit any
representative of the Indenture Trustee, during the Issuer’s normal business
hours, and in a manner that does not unreasonably interfere with the Issuer’s
normal operations, to examine all the books of account, records, reports and
other papers of the Issuer, to make copies and extracts therefrom, to cause
such books to be audited by Independent certified public accountants, and to
discuss the Issuer’s affairs, finances and accounts with the Issuer’s officers,
employees, and Independent certified public accountants, all at such reasonable
times, in such reasonable manner, and as often as may be reasonably requested.
The Indenture Trustee shall and shall cause its representatives, its legal
counsel and its auditors to hold in confidence all such information except to
the extent disclosure may be required by law (and all reasonable applications
for confidential treatment are
unavailing) and except to the extent that the Indenture Trustee may
reasonably determine that such disclosure is consistent with its obligations
hereunder and under applicable law. Notwithstanding anything to the contrary
contained herein, all parties to which this Indenture relates may disclose to
any and all persons, without limitation of any kind, the tax treatment and tax
structure of the transaction and all materials of any kind (including opinions
or other tax analyses) that are provided to such investors relating to such tax
treatment and tax structure. For purposes of this paragraph, the terms “tax
treatment,” “tax structure,” and “tax analyses” have the meaning given to such
terms under Treasury Regulation section 1.6011-4(c).



     Section 11.17 Limitation of Liability.



     It is expressly understood and agreed by the parties hereto that (a) this
Indenture is executed and delivered by Wilmington Trust Company, not
individually or personally but solely as Owner Trustee on behalf of the Issuer
under the Trust Agreement, in the exercise of the powers and authority
conferred and vested in it, (b) each of the representations, undertakings and
agreements herein made on the part of the Issuer is made and intended not as
personal representations, undertakings and agreements by Wilmington Trust
Company but is made and intended for the purpose of binding only the Issuer,
(c) nothing herein contained shall be construed as creating any liability on
Wilmington Trust Company individually or personally, to perform any covenant
either expressed or implied contained herein, all such liability, if any, being
expressly waived by the parties to this Indenture and by any person claiming
by, through or under them and (d) under no circumstances shall Wilmington Trust
Company be personally liable for the payment of any indebtedness or expenses of
the Issuer or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaking by the Issuer under
this Indenture or any related documents.



     Section 11.18 Disclaimer and Subordination.



     Each Noteholder by accepting a Note and each Hedge Counterparty by
accepting the benefits of this Indenture acknowledges and agrees that this
Indenture and the Notes represent a debt obligation of the Issuer only and do
not represent an interest in any assets (other than the Indenture Collateral)
of the Trust Depositor (including by virtue of any deficiency claim in respect
of obligations not paid or otherwise satisfied from the Trust Assets and
proceeds thereof). In furtherance of and not in derogation of the foregoing,
each Noteholder by accepting a Note and each Hedge Counterparty by accepting
the benefits of this Indenture acknowledges and



77









 




agrees that it shall have no
right, title or interest in or to any assets (or interests therein) (other than
the Indenture Collateral) conveyed or purported to be conveyed by the Trust
Depositor to another securitization trust (i.e., other than the Issuer) or
other Person or Persons in connection therewith (whether by way of a sale,
capital contribution or by virtue of the granting of a Lien) (“Other
Assets”). To the extent that, notwithstanding the agreements and
provisions contained in the preceding sentences of this Section 11.18,
any Noteholder or Hedge Counterparty either (i) asserts an interest in or claim
to, or benefit from, Other Assets, whether asserted against or through the
Trust Depositor or any other Person owned by the Trust Depositor, or (ii) is
deemed to have any such interest, claim or benefit in or from Other Assets,
whether by operation of law, legal process, pursuant to applicable provisions
of any applicable insolvency laws or otherwise (including without limitation by
virtue of Section 111l(b) of the federal Bankruptcy Code or any successor
provision having similar effect under the Bankruptcy
Code or any successor provision having similar effect under the Bankruptcy
Code), and whether deemed asserted against or through the Trust Depositor or
any other Person owned by the Trust Depositor, then each Noteholder by
accepting a Note and each Hedge Counterparty by accepting the benefits of this
Indenture further acknowledges and agrees that any such interest, claim or
benefit in or from Other Assets is and shall be expressly subordinated to the
indefeasible payment in full of all obligations and liabilities of the Trust
Depositor which, under the terms of the relevant documents relating to the
securitization of such Other Assets, are entitled to be paid from, entitled to
the benefits of, or otherwise secured by such Other Assets (whether or not any
such entitlement or security interest is legally perfected or otherwise
entitled to a priority of distribution or application under applicable law,
including any applicable insolvency laws, and whether asserted against the
Trust Depositor or any other Person owned by the Trust Depositor), including,
without limitation, the payment of post–petition interest on such other
obligations and liabilities. This subordination agreement shall be deemed a
subordination agreement within the meaning of Section 510(a) of the Bankruptcy
Code. Each Noteholder and each Hedge Counterparty further acknowledges and
agrees that no adequate remedy at law exists for a breach of this Section
11.18 and that the terms and provisions of this Section 11.18 may be
enforced by an action for specific performance. Nothing in this Section
11.18 shall in any way affect the rights of any Hedge Counterparty against
any guaranty by CapitalSource Finance LLC of the Issuer’s obligations under any
Hedge Agreement.




[Remainder of Page Intentionally Left Blank.]






78









 








     IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused their
names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.



	 	 	 	 	 
	 	 	CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1
	 
	 	 	 	 
	

	 	By:	 	WILMINGTON TRUST COMPANY, not in its
individual capacity, but solely as
Owner Trustee on behalf of the Trust
	 
	 	 	 	 
	 	 	By:   /s/
JOANN A. ROZELL
	 	 	


	 	 	Name: JOANN A. ROZELL
	 	 	


	 	 	Title: Financial Services Officer
	 	 	








[Indenture:  CapitalSource 2004-1]


 









 






     IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused their
names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.



	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION, not
in its individual capacity but solely as
the Indenture Trustee
	 
	 	 	 	 
	 	 	By: /s/ JOE NARDI
	 	 	


	 	 	Name: Joe Nardi
	 	 	


	 	 	Title: Vice President
	 	 	







[Indenture:  CapitalSource 2004-1]


 









 






	 	 	 	 	 
	STATE OF DE

	 	 	)	 
	 

	 	 	)	  ss.:

	COUNTY OF NEW CASTLE

	 	 	)	 







     On this June 11 , 2004, before me personally appeared Joann A. Rozell, to me known,
who being by me duly sworn, did depose and say, that he resides at
1100 N. Market St., Wilmington, DE, that he is the Financial Services Officer of the
Owner Trustee, one of the corporations described in and which executed the
above instrument; and that he signed his name thereto by like order.



	 	 	 
	 

	 	                /s/ MICHELE LAUREN CENTRELLA
	 

	 	

	

	 	Notary Public
	

	 	Michelle Lauren Centrella
	

	 	Notary Public – Delaware
	

	 	My Comm. Expires May 17, 2006






[Indenture:  CapitalSource 2004-1]

 









 






	 	 	 	 	 
	STATE OF MINNESOTA

	 	 	)	 
	 

	 	 	)	  ss.:

	COUNTY OF HENNEPIN

	 	 	)	 







     On this June                    , 2004, before me personally appeared Joe Nardi, to me
known, who being by me duly sworn, did depose and say, that he resides at
13668 Ashcroft Road, Savage, Minnesota, 55378 and that he is the Vice President of the Indenture
Trustee, one of the entities described in and which executed the above
instrument; and that he signed his name thereto by like order.



	 	 	 
	 

	 	     /s/ JAMES J. JANUS
	 

	 	

	

	 	Notary Public
	

	 	James J. Janus
	

	 	Notary Public  – Minnesota
	

	 	My Commission Expires Jan. 31, 2005





[Indenture:  CapitalSource 2004-1]


 









 






EXHIBIT A–1




[FORM OF CLASS A-1 NOTE]




CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1



THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES
OR BLUE SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE,
AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS
OF LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE
144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (2) IN CERTIFICATED FORM TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501 (a)(1)–(3) OR (7) UNDER
THE SECURITIES ACT) THAT IS ALSO A QUALIFIED PURCHASER FOR PURPOSES OF SECTION
3(c)(7) UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, PURCHASING FOR
INVESTMENT AND NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, IN EACH
CASE, SUBJECT TO (A) THE RECEIPT BY THE INDENTURE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE INDENTURE AND (B) THE RECEIPT BY THE
INDENTURE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND
BLUE SKY LAWS OF ANY STATE OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION, (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO ANOTHER
EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY
APPLICABLE STATE SECURITIES LAWS, OR (5) PURSUANT TO A VALID REGISTRATION
STATEMENT. THE PURCHASE OF THIS NOTE WILL BE DEEMED A REPRESENTATION BY THE
ACQUIRER THAT EITHER: (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE FOR, ON
BEHALF OF OR WITH THE ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF ERISA AND/OR SECTION 4975 OF THE
CODE OR (II) THE PURCHASE AND HOLDING OF THIS NOTE BY THE ACQUIRER WILL NOT
RESULT IN A NON EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE.



[IF HELD BY DTC] [UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK





A-1-1









 







CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]



[IF REGULATION S GLOBAL NOTE] [THIS NOTE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT AND PRIOR TO THE DATE THAT IS 40 DAYS AFTER
THE LATER OF THE COMMENCEMENT OF THE OFFERING AND THE ORIGINAL ISSUE DATE OF
THE NOTES, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE
UNITED STATES OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.]



THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.






A-1-2









 








	 	 	 
	REGISTERED

	 	$                                      
	 
	 	 
	No. A–1–     

	 	June [   ], 2004







SEE REVERSE FOR CERTAIN DEFINITIONS




	 	 	 
	 

	 	[144A CUSIP NO.                    ]
	

	 	[Reg S ISIN NO.                    ]
	

	 	[Reg S CUSIP No.                   ]
	

	 	[Common Code No.                   ]







     CapitalSource Commercial Loan Trust 2004-1, a statutory trust organized
and existing under the laws of the State of Delaware (herein referred to as the
“Issuer”), for value received, hereby promises to pay to
                                      , or registered assigns, the principal sum of
                   DOLLARS payable on each Remittance Date in an amount equal to the
result obtained by multiplying (i) a fraction, the numerator of which is the
initial principal balance of this Class A-1 Note and the denominator of which
is the Initial Class A-1 Principal Balance by (ii) the aggregate amount, if
any, payable from the Note Distribution Account in respect of principal on the
Class A-1 Notes.



     The principal of and interest on this Class A-1 Note are payable in such
coin or currency of the United States as at the time of payment is legal tender
for payment of public and private debts. All payments made by the Issuer with
respect to this Class A-1 Note shall be applied first to interest due and
payable on this Class A-1 Note as provided above and then to the unpaid
principal of this Class A-1 Note.



     Reference is made to the further provisions of this Class A-1 Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Class A-1 Note.



     Unless the certificate of authentication hereon has been executed by the
Indenture Trustee whose name appears below by manual signature, this Class A-1
Note shall not be entitled to any benefit under the Indenture referred to on
the reverse hereof, or be valid or obligatory for any purpose.



A-1-3









 





     IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Responsible Officer as of the date set forth
above.



	 	 	 	 	 	 	 
	 	 	CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1
	 
	 	 	 	 	 	 
	 	 	By:	 	WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Owner Trustee under the Trust
Agreement
	 
	 	 	 	 	 	 
	 	 	 	 	By:                                                         
	

	 	 	 	 	 	Authorized Signatory







INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION



This is one of the Class A-1 Notes of CapitalSource Commercial Loan Trust
2004-1 designated above and referred to in the within–mentioned Indenture.




	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION, not
in its individual capacity but solely as
Indenture Trustee,
	 
	 	 	 	 
	 	 	By:                                                          
	

	 	 	 	Authorized Signatory







A-1-4









 






[REVERSE OF NOTE]




     This Class A-1 Note is one of a duly authorized issue of Class A-1 Notes
of the Issuer, designated as its CapitalSource Commercial Loan Trust Notes,
Series 2004-1, Class A-1 (herein called the “Class A-1 Notes”), all
issued under an Indenture, dated as of June 22, 2004 (such indenture, as
supplemented or amended, is herein called the “Indenture”), between the
Issuer and Wells Fargo Bank, National Association, as indenture trustee (the
“Indenture Trustee”, which term includes any successor Indenture Trustee
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Class A-1 Notes. The Class A-1 Notes are subject to all terms of the
Indenture. All terms used in this Class A-1 Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.



     Notwithstanding the foregoing, the entire unpaid principal amount of the
Class A-1 Notes shall be due and payable on the date on which an Event of
Default shall have occurred and be continuing and the Indenture Trustee, or the
Majority Noteholders have declared the Class A-1 Notes to be immediately due
and payable in the manner provided in Section 5.02 of the Indenture.
All principal payments on the Class A-1 Notes shall be made pro rata to the
Class A-1 Noteholders entitled thereto.



     Each Class A-1 Noteholder or Class A-1 Note Owner, by acceptance of a
Class A-1 Note or, in the case of a Class A-1 Note Owner, a beneficial interest
in a Class A-1 Note covenants and agrees that no recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer under the
Indenture on the Class A-1 Notes or under any certificate or other writing
delivered in connection therewith, against the Trust Depositor, the Servicer,
the Indenture Trustee or the Owner Trustee in its individual capacity.



     On each Remittance Date, commencing July 20, 2004, the Indenture Trustee
or Paying Agent shall distribute to the Person in whose name this Class A-1
Note is registered at the close of business on the Record Date an amount equal
to the product of the Percentage Interest of the Class A-1 Notes evidenced by
this Class A-1 Note and the amount required to be distributed to Holders of
Class A-1 Notes on such Remittance Date pursuant to Section 3.05 of the
Indenture.



     During each Interest Accrual Period, this Class A-1 Note will bear
interest at the Class A-1 Note Interest Rate.



     Distributions on this Class A-1 Note will be made by the Indenture Trustee
or Paying Agent by check mailed to the address of the Person entitled thereto
as such name and address shall appear on the Note Register or, upon written
request to the Indenture Trustee, by wire transfer of immediately available
funds to the account of the Person entitled thereto as shall appear on the Note
Register without the presentation or surrender of this Note or the making of
any notation thereon, at a bank or other entity having appropriate facilities
therefor, and, in the
case of wire transfers, at the expense of such Person unless such Person
shall own of record Class A-1 Notes which have Initial Class A-1 Principal
Balances aggregating at least $500,000.



A-1-5









 





     Notwithstanding the above, the final distribution on this Class A-1 Note
will be made after due notice by the Indenture Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A-1 Note at
the office or agency maintained for that purpose by the Note Registrar in New
York, New York.



     As provided in the Indenture and the Sale and Servicing Agreement,
deposits and withdrawals from the Note Distribution Account, the Principal and
Interest Account and the Reserve Fund may be made by the Indenture Trustee from
time to time for purposes other than distributions to Class A-1 Noteholders,
such purposes including reimbursement to the Servicer of advances made, or
certain expenses incurred, by it, and investment in Permitted Investments.



     As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Class A-1 Note is registrable in the Note
Register upon surrender of this Class A-1 Note for registration of transfer at
the offices or agencies maintained by the Note Registrar in New York, New York,
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to, the Indenture Trustee, duly executed by the holder hereof or
such holder’s attorney duly authorized in writing, and thereupon one or more
new Class A-1 Notes in authorized denominations evidencing the same aggregate
undivided Percentage Interest will be issued to the designated transferee or
transferees.



     The Class A-1 Note is issuable only as a registered Class A-1 Note. As
provided in the Indenture and subject to certain limitations therein set forth,
the Class A-1 Note is exchangeable for a new Class A-1 Note evidencing the same
undivided ownership interest, as requested by the holder surrendering the same.



     No service charge will be made for any such registration of transfer or
exchange, but the Note Registrar may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.



     The Servicer, the Trust Depositor, the Indenture Trustee and the Note
Registrar, and any agent of any of the foregoing, may treat the person in whose
name this Class A-1 Note is registered as the owner hereof for all purposes,
and none of the foregoing shall be affected by notice to the contrary.



     The obligations and responsibilities created by the Indenture shall
terminate upon the payment to Class A-1 Noteholders of all amounts required to
be paid to them pursuant to the Indenture and the Sale and Servicing Agreement
and the disposition of all property held as part of the Indenture Collateral.



SCHEDULE OF EXCHANGES OF
INTERESTS IN THE GLOBAL NOTE1




     The following exchanges of a part of this Global Note for an interest in
another Global Note or for an Individual Note, or exchanges of a part of
another Global Note or Individual Note for an interest in this Global Note,
have been made:









	1
     This should be included only if the Note is issued in global form.




A-1-6









 










	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Principal Amount of	 	 
	 	 	 	 	 	 	 	 	 	 	this Global Note	 	 
	 	 	Amount of decrease	 	Amount of increase	 	following such	 	Signature of
	 	 	in Principal Amount	 	in Principal Amount	 	decrease	 	Responsible Officer
	Date of Exchange
	 	of this Global Note
	 	of this Global Note
	 	(or increase)
	 	of Note Registrar

	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 







A-1-7









 






ASSIGNMENT



Social Security or taxpayer I.D. or other identifying number of assignee



FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
















(name and address of assignee)



the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints                                       attorney, to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.




	 	 	 
	Dated:                                                         

	 	                                      2







Signature Guaranteed:










	2        NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.




A-1-8









 










EXHIBIT A–2




[FORM OF CLASS A-2 NOTE]




CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1



THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES
OR BLUE SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE,
AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS
OF LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE
144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (2) IN CERTIFICATED FORM TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501 (a)(1)–(3) OR (7) UNDER
THE SECURITIES ACT) THAT IS ALSO A QUALIFIED PURCHASER FOR PURPOSES OF SECTION
3(c)(7) UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, PURCHASING FOR
INVESTMENT AND NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, IN EACH
CASE, SUBJECT TO (A) THE RECEIPT BY THE INDENTURE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE INDENTURE AND (B) THE RECEIPT BY THE
INDENTURE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND
BLUE SKY LAWS OF ANY STATE OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION, (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO ANOTHER
EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY
APPLICABLE STATE SECURITIES LAWS, OR (5) PURSUANT TO A VALID REGISTRATION
STATEMENT. THE PURCHASE OF THIS NOTE WILL BE DEEMED A REPRESENTATION BY THE
ACQUIRER THAT EITHER: (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE FOR, ON
BEHALF OF OR WITH THE ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF ERISA AND/OR SECTION 4975 OF THE
CODE OR (II) THE PURCHASE AND HOLDING OF THIS NOTE BY THE ACQUIRER WILL NOT
RESULT IN A NON EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE.






A-2-1









 







[IF HELD BY DTC] [UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE
ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]



[IF REGULATION S GLOBAL NOTE] [THIS NOTE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT AND PRIOR TO THE DATE THAT IS 40 DAYS AFTER
THE LATER OF THE COMMENCEMENT OF THE OFFERING AND THE ORIGINAL ISSUE DATE OF
THE NOTES, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE
UNITED STATES OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.]



THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.



THE RIGHTS OF THE HOLDER OF THIS CLASS A-2 NOTE TO RECEIVE INTEREST ARE
SUBORDINATED TO THE RIGHTS OF THE HOLDERS OF THE CLASS A-1 NOTES TO RECEIVE
INTEREST AND THE RIGHTS OF THE HOLDERS OF THIS CLASS A-2 NOTE TO RECEIVE
PRINCIPAL ARE SUBORDINATED TO THE RIGHTS OF THE HOLDERS OF THE CLASS A-1 NOTES
TO RECEIVE PRINCIPAL AND INTEREST TO THE EXTENT SET FORTH IN THE SALE AND
SERVICING AGREEMENT.






A-2-2









 








	 	 	 
	REGISTERED

	 	$                                      
	 
	 	 
	No. A-2-     

	 	June [   ], 2004







SEE REVERSE FOR CERTAIN DEFINITIONS




	 	 	 
	 

	 	[144A CUSIP NO.                    ]
	

	 	[Reg S ISIN NO.                    ]
	

	 	[Reg S CUSIP No.                   ]
	

	 	[Common Code No.                   ]







     CapitalSource Commercial Loan Trust 2004-1, a statutory trust organized
and existing under the laws of the State of Delaware (herein referred to as the
“Issuer”), for value received, hereby promises to pay to
                                                         , or registered assigns, the principal sum of
                                       DOLLARS payable on each Remittance Date in an amount equal to the
result obtained by multiplying (i) a fraction, the numerator of which is the
initial principal balance of this Class A-2 Note and the denominator of which
is the Initial Class A-2 Principal Balance by (ii) the aggregate amount, if
any, payable from the Note Distribution Account in respect of principal on the
Class A-2 Notes.



     The principal of and interest on this Class A-2 Note are payable in such
coin or currency of the United States as at the time of payment is legal tender
for payment of public and private debts. All payments made by the Issuer with
respect to this Class A-2 Note shall be applied first to interest due and
payable on this Class A-2 Note as provided above and then to the unpaid
principal of this Class A-2 Note.



     Reference is made to the further provisions of this Class A-2 Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Class A-2 Note.



     Unless the certificate of authentication hereon has been executed by the
Indenture Trustee whose name appears below by manual signature, this Class A-2
Note shall not be entitled to any benefit under the Indenture referred to on
the reverse hereof, or be valid or obligatory for any purpose.



A-2-3









 





     IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Responsible Officer as of the date set forth
above.



	 	 	 	 	 	 	 
	 	 	CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1
	 
	 	 	 	 	 	 
	 	 	By:	 	WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as Owner Trustee under the Trust
Agreement
	 
	 	 	 	 	 	 
	 	 	 	 	By:                                                                
	

	 	 	 	 	 	Authorized Signatory







INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION



This is one of the Class A-2 Notes of CapitalSource Commercial Loan Trust
2004-1 designated above and referred to in the within–mentioned Indenture.




	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION, not
in its individual capacity but solely as
Indenture Trustee,
	 
	 	 	 	 
	 	 	By:                                                                 
	

	 	 	 	Authorized Signatory







A-2-4









 






[REVERSE OF NOTE]




     This Class A-2 Note is one of a duly authorized issue of Class A-2 Notes
of the Issuer, designated as its CapitalSource Commercial Loan Trust Notes,
Series 2004-1, Class A-2 (herein called the “Class A-2 Notes”), all
issued under an Indenture, dated as of June 22, 2004 (such indenture, as
supplemented or amended, is herein called the “Indenture”), between the
Issuer and Wells Fargo Bank, National Association, as indenture trustee (the
“Indenture Trustee”, which term includes any successor Indenture Trustee
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Class A-2 Notes. The Class A-2 Notes are subject to all terms of the
Indenture. All terms used in this Class A-2 Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.



     Notwithstanding the foregoing, the entire unpaid principal amount of the
Class A-2 Notes shall be due and payable on the date on which an Event of
Default shall have occurred and be continuing and the Indenture Trustee, or the
Majority Noteholders have declared the Class A-2 Notes to be immediately due
and payable in the manner provided in Section 5.02 of the Indenture.
All principal payments on the Class A-2 Notes shall be made pro rata to the
Class A-2 Noteholders entitled thereto.



     Each Class A-2 Noteholder or Class A-2 Note Owner, by acceptance of a
Class A-2 Note or, in the case of a Class A-2 Note Owner, a beneficial interest
in a Class A-2 Note covenants and agrees that no recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer under the
Indenture on the Class A-2 Notes or under any certificate or other writing
delivered in connection therewith, against the Trust Depositor, the Servicer,
the Indenture Trustee or the Owner Trustee in its individual capacity.



     On each Remittance Date, commencing July 20, 2004, the Indenture Trustee
or Paying Agent shall distribute to the Person in whose name this Class A-2
Note is registered at the close of business on the Record Date an amount equal
to the product of the Percentage Interest of the Class A-2 Notes evidenced by
this Class A-2 Note and the amount required to be distributed to Holders of
Class A-2 Notes on such Remittance Date pursuant to Section 3.05 of the
Indenture.



     During each Interest Accrual Period, this Class A-2 Note will bear
interest at the Class A-2 Note Interest Rate.



     Distributions on this Class A-2 Note will be made by the Indenture Trustee
or Paying Agent by check mailed to the address of the Person entitled thereto
as such name and address shall appear on the Note Register or, upon written
request to the Indenture Trustee, by wire transfer of immediately available
funds to the account of the Person entitled thereto as shall appear on the Note
Register without the presentation or surrender of this Note or the making of
any notation thereon, at a bank or other entity having appropriate facilities
therefor, and, in the
case of wire transfers, at the expense of such Person unless such Person
shall own of record Class A-2 Notes which have Initial Class A-2 Principal
Balances aggregating at least $500,000.



A-2-5









 




     Notwithstanding the above, the final distribution on this Class A-2 Note
will be made after due notice by the Indenture Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A-2 Note at
the office or agency maintained for that purpose by the Note Registrar in New
York, New York.



     As provided in the Indenture and the Sale and Servicing Agreement,
deposits and withdrawals from the Note Distribution Account, the Principal and
Interest Account and the Reserve Fund may be made by the Indenture Trustee from
time to time for purposes other than distributions to Class A-2 Noteholders,
such purposes including reimbursement to the Servicer of advances made, or
certain expenses incurred, by it, and investment in Permitted Investments.



     As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Class A-2 Note is registrable in the Note
Register upon surrender of this Class A-2 Note for registration of transfer at
the offices or agencies maintained by the Note Registrar in New York, New York,
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to, the Indenture Trustee, duly executed by the holder hereof or
such holder’s attorney duly authorized in writing, and thereupon one or more
new Class A-2 Notes in authorized denominations evidencing the same aggregate
undivided Percentage Interest will be issued to the designated transferee or
transferees.



     The Class A-2 Note is issuable only as a registered Class A-2 Note. As
provided in the Indenture and subject to certain limitations therein set forth,
the Class A-2 Note is exchangeable for a new Class A-2 Note evidencing the same
undivided ownership interest, as requested by the holder surrendering the same.



     No service charge will be made for any such registration of transfer or
exchange, but the Note Registrar may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.



     The Servicer, the Trust Depositor, the Indenture Trustee and the Note
Registrar, and any agent of any of the foregoing, may treat the person in whose
name this Class A-2 Note is registered as the owner hereof for all purposes,
and none of the foregoing shall be affected by notice to the contrary.



     The obligations and responsibilities created by the Indenture shall
terminate upon the payment to Class A-2 Noteholders of all amounts required to
be paid to them pursuant to the Indenture and the Sale and Servicing Agreement
and the disposition of all property held as part of the Indenture Collateral.




SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE3




     The following exchanges of a part of this Global Note for an interest in
another Global Note or for an Individual Note, or exchanges of a part of
another Global Note or Individual Note for an interest in this Global Note,
have been made:







	3
     This should be included only if the Note is issued in global form.



A-2-6









 





	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Principal Amount of	 	 
	 	 	 	 	 	 	 	 	 	 	this Global Note	 	 
	 	 	Amount of decrease	 	Amount of increase	 	following such	 	Signature of
	 	 	in Principal Amount	 	in Principal Amount	 	decrease	 	Responsible Officer
	Date of Exchange
	 	of this Global Note
	 	of this Global Note
	 	(or increase)
	 	of Note Registrar

	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 










A-2-7









 










ASSIGNMENT



Social Security or taxpayer I.D. or other identifying number of assignee



FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto













(name and address of assignee)



the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints
               , attorney, to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.




	 	 	 
	Dated:                                                         

	 	                                      4







Signature Guaranteed:










	4      NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.




A-2-8









 










EXHIBIT A–3




[FORM OF CLASS B NOTE]




CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1



THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES
OR BLUE SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE,
AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS
OF LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE
144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (2) IN CERTIFICATED FORM TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501 (a)(1)–(3) OR (7) UNDER
THE SECURITIES ACT) THAT IS ALSO A QUALIFIED PURCHASER FOR PURPOSES OF SECTION
3(c)(7) UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, PURCHASING FOR
INVESTMENT AND NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, IN EACH
CASE, SUBJECT TO (A) THE RECEIPT BY THE INDENTURE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE INDENTURE AND (B) THE RECEIPT BY THE
INDENTURE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND
BLUE SKY LAWS OF ANY STATE OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION, (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO ANOTHER
EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY
APPLICABLE STATE SECURITIES LAWS, OR (5) PURSUANT TO A VALID REGISTRATION
STATEMENT. THE PURCHASE OF THIS NOTE WILL BE DEEMED A REPRESENTATION BY THE
ACQUIRER THAT EITHER: (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE FOR, ON
BEHALF OF OR WITH THE ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF ERISA AND/OR SECTION 4975 OF THE
CODE OR (II) THE PURCHASE AND HOLDING OF THIS NOTE BY THE ACQUIRER WILL NOT
RESULT IN A NON EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE.




     [IF HELD BY DTC] [UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK



A-3-1









 




CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]




     [IF REGULATION S GLOBAL NOTE] [THIS NOTE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT AND PRIOR TO THE DATE THAT IS 40 DAYS AFTER
THE LATER OF THE COMMENCEMENT OF THE OFFERING AND THE ORIGINAL ISSUE DATE OF
THE NOTES, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE
UNITED STATES OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.]



     THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.



     THE RIGHTS OF THE HOLDER OF THIS CLASS B NOTE TO RECEIVE INTEREST ARE
SUBORDINATED TO THE RIGHTS OF THE HOLDERS OF THE CLASS A-1 NOTES AND THE CLASS
A-2 NOTES TO RECEIVE INTEREST AND THE RIGHTS OF THE HOLDERS OF THIS CLASS B
NOTE TO RECEIVE PRINCIPAL ARE SUBORDINATED TO THE RIGHTS OF THE HOLDERS OF THE
CLASS A-1 NOTES AND CLASS A-2 NOTES TO RECEIVE PRINCIPAL AND INTEREST TO THE
EXTENT SET FORTH IN THE SALE AND SERVICING AGREEMENT.



A-3-2









 





	 	 	 
	REGISTERED

	 	$                                      
	 
	 	 
	No. B     

	 	June [   ], 2004







SEE REVERSE FOR CERTAIN DEFINITIONS




	 	 	 
	 

	 	[144A CUSIP NO.                    ]
	

	 	[Reg S ISIN NO.                    ]
	

	 	[Reg S CUSIP No.                   ]
	

	 	[Common Code No.                   ]







     CapitalSource Commercial Loan Trust 2004-1, a statutory trust organized
and existing under the laws of the State of Delaware (herein referred to as the
“Issuer”), for value received, hereby promises to pay to
                 
                                       , or registered assigns, the principal sum of                                       
DOLLARS payable on each Remittance Date in an amount equal to the result
obtained by multiplying (i) a fraction, the numerator of which is the initial
principal balance of this Class B Note and the denominator of which is the
Initial Class B Principal Balance by (ii) the aggregate amount, if any, payable
from the Note Distribution Account in respect of principal on the Class B Notes
pursuant to Section 3.05 of the Indenture.



     The principal of and interest on this Class B Note are payable in such
coin or currency of the United States as at the time of payment is legal tender
for payment of public and private debts. All payments made by the Issuer with
respect to this Class B Note shall be applied first to interest due and payable
on this Class B Note as provided above and then to the unpaid principal of this
Class B Note.



     Reference is made to the further provisions of this Class B Note set forth
on the reverse hereof, which shall have the same effect as though fully set
forth on the face of this Class B Note.



     Unless the certificate of authentication hereon has been executed by the
Indenture Trustee whose name appears below by manual signature, this Class B
Note shall not be entitled to any benefit under the Indenture referred to on
the reverse hereof, or be valid or obligatory for any purpose.



A-3-3









 





     IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Responsible Officer as of the date set forth
above.



	 	 	 	 	 	 	 
	 	 	CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1
	 
	 	 	 	 	 	 
	 	 	By:	 	WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Owner Trustee under the Trust
Agreement
	 
	 	 	 	 	 	 
	 	 	 	 	By:                                                          
	

	 	 	 	 	 	Authorized Signatory







INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION



This is one of the Class B Notes of CapitalSource Commercial Loan Trust 2004-1
designated above and referred to in the within–mentioned Indenture.




	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION, not
in its individual capacity but solely as
Indenture Trustee,
	 
	 	 	 	 
	 	 	By:                                                          
	

	 	 	 	Authorized Signatory







A-3-4









 






[REVERSE OF NOTE]




     This Class B Note is one of a duly authorized issue of Class B Notes of
the Issuer, designated as its CapitalSource Commercial Loan Trust Notes, Series
2004-1, Class B (herein called the “Class B Notes”), all issued under an
Indenture, dated as of June 22, 2004 (such indenture, as supplemented or
amended, is herein called the “Indenture”), between the Issuer and Wells
Fargo Bank, National Association, as indenture trustee (the “Indenture
Trustee”, which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Class B Notes. The Class B Notes are subject to all terms of the
Indenture. All terms used in this Class B Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.



     Notwithstanding the foregoing, the entire unpaid principal amount of the
Class B Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee, or the
Majority Noteholders have declared the Class B Notes to be immediately due and
payable in the manner provided in Section 5.02 of the Indenture. All
principal payments on the Class B Notes shall be made pro rata to the Class B
Noteholders entitled thereto.



     Each Class B Noteholder or Class B Note Owner, by acceptance of a Class B
Note or, in the case of a Class B Note Owner, a beneficial interest in a Class
B Note covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer under the Indenture
on the Class B Notes or under any certificate or other writing delivered in
connection therewith, against the Trust Depositor, the Servicer, the Indenture
Trustee or the Owner Trustee in its individual capacity or any of their
Affiliates.



     On each Remittance Date, commencing July 20, 2004, the Indenture Trustee
or Paying Agent shall distribute to the Person in whose name this Class B Note
is registered at the close of business on the Record Date an amount equal to
the product of the Percentage Interest of the Class B Notes evidenced by this
Class B Note and the amount required to be distributed to Holders of Class B
Notes on such Remittance Date pursuant to Section 3.05 of the Indenture.



     During each Interest Accrual Period, this Class B Note will bear interest
at the Class B Note Interest Rate.



     Distributions on this Class B Note will be made by the Indenture Trustee
or Paying Agent by check mailed to the address of the Person entitled thereto
as such name and address shall appear on the Note Register or, upon written
request to the Indenture Trustee, by wire transfer of immediately available
funds to the account of the Person entitled thereto as shall appear on the Note
Register without the presentation or surrender of this Note or the making of
any notation thereon, at a bank or other entity having appropriate facilities
therefor, and, in the case of wire transfers, at the expense of such Person
unless such Person shall own of record Class B Notes which have Initial Class B
Principal Balances aggregating at least $500,000.



A-3-5









 





     Notwithstanding the above, the final distribution on this Class B Note
will be made after due notice by the Indenture Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class B Note at
the office or agency maintained for that purpose by the Note Registrar in New
York, New York.



     As provided in the Indenture and the Sale and Servicing Agreement,
deposits and withdrawals from the Note Distribution Account, the Principal and
Interest Account and the Reverse Fund may be made by the Indenture Trustee from
time to time for purposes other than distributions to Class B Noteholders, such
purposes including reimbursement to the Servicer of advances made, or certain
expenses incurred, by it, and investment in Permitted Investments.



     As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Class B Note is registrable in the Note
Register upon surrender of this Class B Note for registration of transfer at
the offices or agencies maintained by the Note Registrar in New York, New York,
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to, the Indenture Trustee, duly executed by the holder hereof or
such holder’s attorney duly authorized in writing, and thereupon one or more
new Class B Notes in authorized denominations evidencing the same aggregate
undivided Percentage Interest will be issued to the designated transferee or
transferees.



     The Class B Note is issuable only as a registered Class B Note. As
provided in the Indenture and subject to certain limitations therein set forth,
the Class B Note is exchangeable for a new Class B Note evidencing the same
undivided ownership interest, as requested by the holder surrendering the same.



     No service charge will be made for any such registration of transfer or
exchange, but the Note Registrar may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.



     The Servicer, the Trust Depositor, the Indenture Trustee and the Note
Registrar, and any agent of any of the foregoing, may treat the person in whose
name this Class B Note is registered as the owner hereof for all purposes, and
none of the foregoing shall be affected by notice to the contrary.



     The obligations and responsibilities created by the Indenture shall
terminate upon the payment to Class B Noteholders of all amounts required to be
paid to them pursuant to the Indenture and the Sale and Servicing Agreement and
the disposition of all property held as part of the Indenture Collateral.



A-3-6









 





SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE5




     The following exchanges of a part of this Global Note for an interest in
another Global Note or for an Individual Note, or exchanges of a part of
another Global Note or Individual Note for an interest in this Global Note,
have been made:



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Principal Amount of	 	 
	 	 	 	 	 	 	 	 	 	 	this Global Note	 	 
	 	 	Amount of decrease	 	Amount of increase	 	following such	 	Signature of
	 	 	in Principal Amount	 	in Principal Amount	 	decrease	 	Responsible Officer
	Date of Exchange
	 	of this Global Note
	 	of this Global Note
	 	(or increase)
	 	of Note Registrar

	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 













	5	 	This should be included only if the Note is issued in global form.




A-3-7









 










ASSIGNMENT



Social Security or taxpayer I.D. or other identifying number of assignee



FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto












(name and address of assignee)



the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints                                       , attorney, to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.




	 	 	 
	Dated:                                                         

	 	                                      6







Signature Guaranteed:










	6       NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.






A-3-8










 





EXHIBIT A–4




[FORM OF CLASS C NOTE]




CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1




THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES
OR BLUE SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE,
AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS
OF LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE
144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (2) IN CERTIFICATED FORM TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501 (a)(1)–(3) OR (7) UNDER
THE SECURITIES ACT) THAT IS ALSO A QUALIFIED PURCHASER FOR PURPOSES OF SECTION
3(c)(7) UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, PURCHASING FOR
INVESTMENT AND NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, IN EACH
CASE, SUBJECT TO (A) THE RECEIPT BY THE INDENTURE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE INDENTURE AND (B) THE RECEIPT BY THE
INDENTURE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND
BLUE SKY LAWS OF ANY STATE OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION, (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO ANOTHER
EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY
APPLICABLE STATE SECURITIES LAWS, OR (5) PURSUANT TO A VALID REGISTRATION
STATEMENT. THE PURCHASE OF THIS NOTE WILL BE DEEMED A REPRESENTATION BY THE
ACQUIRER THAT EITHER: (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE FOR, ON
BEHALF OF OR WITH THE ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF ERISA AND/OR SECTION 4975 OF THE
CODE OR (II) THE PURCHASE AND HOLDING OF THIS NOTE BY THE ACQUIRER WILL NOT
RESULT IN A NON EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE.



     [IF HELD BY DTC] [UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK



A-4-1









 





CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]



     [IF REGULATION S GLOBAL NOTE] [THIS NOTE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT AND PRIOR TO THE DATE THAT IS 40 DAYS AFTER
THE LATER OF THE COMMENCEMENT OF THE OFFERING AND THE ORIGINAL ISSUE DATE OF
THE NOTES, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE
UNITED STATES OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.]



     THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.



     THE RIGHTS OF THE HOLDER OF THIS CLASS C NOTE TO RECEIVE INTEREST ARE
SUBORDINATED TO THE RIGHTS OF THE HOLDERS OF THE CLASS A-1 NOTES, THE CLASS A-2
NOTES AND THE CLASS B NOTES TO RECEIVE INTEREST AND THE RIGHTS OF THE HOLDERS
OF THIS CLASS C NOTE TO RECEIVE PRINCIPAL ARE SUBORDINATED TO THE RIGHTS OF THE
HOLDERS OF THE CLASS A-1 NOTES, THE CLASS A-2 NOTES AND THE CLASS B NOTES TO
RECEIVE PRINCIPAL AND INTEREST TO THE EXTENT SET FORTH IN THE SALE AND
SERVICING AGREEMENT.



A-4-2









 






			
	 	 	 
	REGISTERED
	 	$                        
	 	 	 
	No. C–
	 	June
[   ], 2004
	 	 	 







SEE REVERSE FOR CERTAIN DEFINITIONS




	 	 	 
	 

	 	[144A CUSIP NO.                            ]
	

	 	[Reg S ISIN NO.                        ]
	

	 	[Reg S CUSIP No.                        ]
	

	 	[Common Code No.                    ]







     CapitalSource Commercial Loan Trust 2004-1, a statutory trust organized
and existing under the laws of the State of Delaware (herein referred to as the
“Issuer”), for value received, hereby promises to pay to
      , or registered assigns, the principal sum of
     
DOLLARS payable on each Remittance Date in an amount equal to the result
obtained by multiplying (i) a fraction, the numerator of which is the initial
principal balance of this Class C Note and the denominator of which is the
Initial Class C Principal Balance by (ii) the aggregate amount, if any, payable
from the Note Distribution Account in respect of principal on the Class C Notes
pursuant to Section 3.05 of the Indenture.



     The principal of and interest on this Class C Note are payable in such
coin or currency of the United States as at the time of payment is legal tender
for payment of public and private debts. All payments made by the Issuer with
respect to this Class C Note shall be applied first to interest due and payable
on this Class C Note as provided above and then to the unpaid principal of this
Class C Note.



     Reference is made to the further provisions of this Class C Note set forth
on the reverse hereof, which shall have the same effect as though fully set
forth on the face of this Class C Note.



     Unless the certificate of authentication hereon has been executed by the
Indenture Trustee whose name appears below by manual signature, this Class C
Note shall not be entitled to any benefit under the Indenture referred to on
the reverse hereof, or be valid or obligatory for any purpose.



A-4-3









 





     IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Responsible Officer as of the date set forth
below.



	 	 	 	 	 	 	 
	 	 	CAPITALSOURCE COMMERCIAL LOAN
	 	 	TRUST 2004-1
	 
	 	 	 	 	 	 
	 	 	By:	 	WILMINGTON TRUST COMPANY, not in its

individual capacity but solely as Owner Trustee under the Trust Agreement
	 
	 	 	 	 	 	 
	

	 	 	 	By:
	 	


	

	 	 	 	 	 	Authorized Signatory







INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION




This is one of the Class C Notes of CapitalSource Commercial Loan Trust 2004-1
designated above and referred to in the within–mentioned Indenture.



	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL
	 	 	ASSOCIATION, not in its individual capacity but
	 	 	solely as Indenture Trustee,
	 
	 	 	 	 
	

	 	By:
	 	



	

	 	 	 	Authorized Signatory







A-4-4









 






[REVERSE OF NOTE]




     This Class C Note is one of a duly authorized issue of Class C Notes of
the Issuer, designated as its CapitalSource Commercial Loan Trust Notes, Series
2004-1, Class C (herein called the “Class C Notes”), all issued under an
Indenture, dated as of June 22, 2004 (such indenture, as supplemented or
amended, is herein called the “Indenture”), between the Issuer and Wells
Fargo Bank, National Association, as indenture trustee (the “Indenture
Trustee”, which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Class C Notes. The Class C Notes are subject to all terms of the
Indenture. All terms used in this Class C Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.



     Notwithstanding the foregoing, the entire unpaid principal amount of the
Class C Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee, or the
Majority Noteholders have declared the Class C Notes to be immediately due and
payable in the manner provided in Section 5.02 of the Indenture. All
principal payments on the Class C Notes shall be made pro rata to the Class C
Noteholders entitled thereto.



     Each Class C Noteholder or Class C Note Owner, by acceptance of a Class C
Note or, in the case of a Class C Note Owner, a beneficial interest in a Class
C Note covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer under the Indenture
on the Class C Notes or under any certificate or other writing delivered in
connection therewith, against the Trust Depositor, the Servicer, the Indenture
Trustee or the Owner Trustee in its individual capacity or any of their
Affiliates.



     On each Remittance Date, commencing July 20, 2004, the Indenture Trustee
or Paying Agent shall distribute to the Person in whose name this Class C Note
is registered at the close of business on the Record Date an amount equal to
the product of the Percentage Interest of the Class C Notes evidenced by this
Class C Note and the amount required to be distributed to Holders of Class C
Notes on such Remittance Date pursuant to Section 3.05 of the Indenture.



     During each Interest Accrual Period, this Class C Note will bear interest
at the Class C Note Interest Rate.



     Distributions on this Class C Note will be made by the Indenture Trustee
or Paying Agent by check mailed to the address of the Person entitled thereto
as such name and address shall appear on the Note Register or, upon written
request to the Indenture Trustee, by wire transfer of immediately available
funds to the account of the Person entitled thereto as shall appear on the Note
Register without the presentation or surrender of this Note or the making of
any notation thereon, at a bank or other entity having appropriate facilities
therefor, and, in the case of wire transfers, at the expense of such Person
unless such Person shall own of record Class C Notes which have Initial Class C
Principal Balances aggregating at least $500,000.



A-4-5









 





     Notwithstanding the above, the final distribution on this Class C Note
will be made after due notice by the Indenture Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class C Note at
the office or agency maintained for that purpose by the Note Registrar in New
York, New York.



     As provided in the Indenture and the Sale and Servicing Agreement,
deposits and withdrawals from the Note Distribution Account, the Principal and
Interest Account and the Reserve Fund may be made by the Indenture Trustee from
time to time for purposes other than distributions to Class C Noteholders, such
purposes including reimbursement to the Servicer of advances made, or certain
expenses incurred, by it, and investment in Permitted Investments.



     As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Class C Note is registrable in the Note
Register upon surrender of this Class C Note for registration of transfer at
the offices or agencies maintained by the Note Registrar in New York, New York,
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to, the Indenture Trustee, duly executed by the holder hereof or
such holder’s attorney duly authorized in writing, and thereupon one or more
new Class C Notes in authorized denominations evidencing the same aggregate
undivided Percentage Interest will be issued to the designated transferee or
transferees.



     The Class C Note is issuable only as a registered Class C Note. As
provided in the Indenture and subject to certain limitations therein set forth,
the Class C Note is exchangeable for a new Class C Note evidencing the same
undivided ownership interest, as requested by the holder surrendering the same.



     No service charge will be made for any such registration of transfer or
exchange, but the Note Registrar may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.



     The Servicer, the Trust Depositor, the Indenture Trustee and the Note
Registrar, and any agent of any of the foregoing, may treat the person in whose
name this Class C Note is registered as the owner hereof for all purposes, and
none of the foregoing shall be affected by notice to the contrary.



     The obligations and responsibilities created by the Indenture with respect
to this Class C Note shall terminate upon the payment to Class C Noteholders of
all amounts required to be paid to them pursuant to the Indenture and the Sale
and Servicing Agreement and the disposition of all property held as part of the
Indenture Collateral with respect to this Class C Note.



A-4-6









 





SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE7




     The following exchanges of a part of this Global Note for an interest in
another Global Note or for an Individual Note, or exchanges of a part of
another Global Note or Individual Note for an interest in this Global Note,
have been made:



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Amount of	 	Amount of	 	Principal Amount	 	 
	 	 	decrease in	 	increase in	 	of this Global	 	Signature of
	 	 	Principal Amount	 	Principal Amount	 	Note following	 	Responsible
	Date of	 	of this Global	 	of this Global	 	such decrease	 	Officer of Note
	Exchange
	 	Note
	 	Note
	 	(or increase)
	 	Registrar

	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 













	7	 	This should be included only if the Note is issued in global form.




A-4-7









 










ASSIGNMENT




Social Security or taxpayer I.D. or other identifying number of assignee



FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto











(name and address of assignee)




the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints        , attorney, to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.



	 	 	 	 	 
	Dated:

	


	 	


	 8







Signature Guaranteed:









8     NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.



A-4-8









 








EXHIBIT A–5




[FORM OF CLASS D NOTE]




CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1




THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES
OR BLUE SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE,
AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS
OF LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE
144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (2) IN CERTIFICATED FORM TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501 (a)(1)–(3) OR (7) UNDER
THE SECURITIES ACT) THAT IS ALSO A QUALIFIED PURCHASER FOR PURPOSES OF SECTION
3(c)(7) UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, PURCHASING FOR
INVESTMENT AND NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, IN EACH
CASE, SUBJECT TO (A) THE RECEIPT BY THE INDENTURE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE INDENTURE AND (B) THE RECEIPT BY THE
INDENTURE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND
BLUE SKY LAWS OF ANY STATE OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION, (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO ANOTHER
EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY
APPLICABLE STATE SECURITIES LAWS, OR (5) PURSUANT TO A VALID REGISTRATION
STATEMENT. THE PURCHASE OF THIS NOTE WILL BE DEEMED A REPRESENTATION BY THE
ACQUIRER THAT EITHER: (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE FOR, ON
BEHALF OF OR WITH THE ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF ERISA AND/OR SECTION 4975 OF THE
CODE OR (II) THE PURCHASE AND HOLDING OF THIS NOTE BY THE ACQUIRER WILL NOT
RESULT IN A NON EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE.



     [IF HELD BY DTC] [UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK



A-5-1









 





CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]



     [IF REGULATION S GLOBAL NOTE] [THIS NOTE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT AND PRIOR TO THE DATE THAT IS 40 DAYS AFTER
THE LATER OF THE COMMENCEMENT OF THE OFFERING AND THE ORIGINAL ISSUE DATE OF
THE NOTES, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE
UNITED STATES OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.]



     THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.



     THE RIGHTS OF THE HOLDER OF THIS CLASS D NOTE TO RECEIVE INTEREST ARE
SUBORDINATED TO THE RIGHTS OF THE HOLDERS OF THE CLASS A-1 NOTES, THE CLASS A-2
NOTES, THE CLASS B NOTES AND THE CLASS C NOTES TO RECEIVE INTEREST AND THE
RIGHTS OF THE HOLDERS OF THIS CLASS D NOTE TO RECEIVE PRINCIPAL ARE
SUBORDINATED TO THE RIGHTS OF THE HOLDERS OF THE CLASS A-1 NOTES, THE CLASS A-2
NOTES, THE CLASS B NOTES AND THE CLASS C NOTES TO RECEIVE PRINCIPAL AND
INTEREST TO THE EXTENT SET FORTH IN THE SALE AND SERVICING AGREEMENT.



A-5-2









 





			
	 	 	 
	REGISTERED
	 	$                        
	 	 	 
	No. D-
	 	June [   ], 2004
	 	 	 







SEE REVERSE FOR CERTAIN DEFINITIONS




	 	 	 
	 

	 	[144A CUSIP NO.                            ]
	

	 	[Reg S ISIN NO.                        ]
	

	 	[Reg S CUSIP No.                        ]
	

	 	[Common Code No.                    ]







     CapitalSource Commercial Loan Trust 2004-1, a statutory trust organized
and existing under the laws of the State of Delaware (herein referred to as the
“Issuer”), for value received, hereby promises to pay to
       , or registered assigns, the principal sum of 
       
DOLLARS payable on each Remittance Date in an amount equal to the result
obtained by multiplying (i) a fraction, the numerator of which is the initial
principal balance of this Class D Note and the denominator of which is the
Initial Class D Principal Balance by (ii) the aggregate amount, if any, payable
from the Note Distribution Account in respect of principal on the Class D Notes
pursuant to Section 3.05 of the Indenture.



     The principal of and interest on this Class D Note are payable in such
coin or currency of the United States as at the time of payment is legal tender
for payment of public and private debts. All payments made by the Issuer with
respect to this Class D Note shall be applied first to interest due and payable
on this Class D Note as provided above and then to the unpaid principal of this
Class D Note.



     Reference is made to the further provisions of this Class D Note set forth
on the reverse hereof, which shall have the same effect as though fully set
forth on the face of this Class D Note.



     Unless the certificate of authentication hereon has been executed by the
Indenture Trustee whose name appears below by manual signature, this Class D
Note shall not be entitled to any benefit under the Indenture referred to on
the reverse hereof, or be valid or obligatory for any purpose.



A-5-3









 





     IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Responsible Officer as of the date set forth
below.



	 	 	 	 	 	 	 
	 	 	CAPITALSOURCE COMMERCIAL LOAN
	 	 	TRUST 2004-1
	 
	 	 	 	 	 	 
	 	 	By:	 	WILMINGTON TRUST COMPANY, not in its

individual capacity but solely as Owner Trustee under the Trust Agreement
	 
	 	 	 	 	 	 
	

	 	 	 	By:
	 	


	

	 	 	 	 	 	Authorized Signatory







INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION




     This is one of the Class D Notes of CapitalSource Commercial Loan Trust 2004-1
designated above and referred to in the within–mentioned Indenture.



	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION, not

in its individual capacity but solely as Indenture Trustee,
	 
	 	 	 	 
	

	 	By:
	 	


	

	 	 	 	Authorized Signatory







A-5-4









 






[REVERSE OF NOTE]




     This Class D Note is one of a duly authorized issue of Class D Notes of
the Issuer, designated as its CapitalSource Commercial Loan Trust Notes, Series
2004-1, Class D (herein called the “Class D Notes”), all issued under an
Indenture, dated as of June 22, 2004 (such indenture, as supplemented or
amended, is herein called the “Indenture”), between the Issuer and Wells
Fargo Bank, National Association, as indenture trustee (the “Indenture
Trustee”, which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Class D Notes. The Class D Notes are subject to all terms of the
Indenture. All terms used in this Class D Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.



     Notwithstanding the foregoing, the entire unpaid principal amount of the
Class D Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee, or the
Majority Noteholders have declared the Class D Notes to be immediately due and
payable in the manner provided in Section 5.02 of the Indenture. All
principal payments on the Class D Notes shall be made pro rata to the Class D
Noteholders entitled thereto.



     Each Class D Noteholder or Class D Note Owner, by acceptance of a Class D
Note or, in the case of a Class D Note Owner, a beneficial interest in a Class
D Note covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer under the Indenture
on the Class D Notes or under any certificate or other writing delivered in
connection therewith, against the Trust Depositor, the Servicer, the Indenture
Trustee or the Owner Trustee in its individual capacity or any of their
Affiliates.



     On each Remittance Date, commencing July 20, 2004, the Indenture Trustee
or Paying Agent shall distribute to the Person in whose name this Class D Note

is registered at the close of business on the Record Date an amount equal to
the product of the Percentage Interest of the Class D Notes evidenced by this
Class D Note and the amount required to be distributed to Holders of Class D
Notes on such Remittance Date pursuant to Section 3.05 of the Indenture.



     During each Interest Accrual Period, this Class D Note will bear interest
at the Class D Note Interest Rate.



     Distributions on this Class D Note will be made by the Indenture Trustee
or Paying Agent by check mailed to the address of the Person entitled thereto
as such name and address shall appear on the Note Register or, upon written
request to the Indenture Trustee, by wire transfer of immediately available
funds to the account of the Person entitled thereto as shall appear on the Note
Register without the presentation or surrender of this Note or the making of
any notation thereon, at a bank or other entity having appropriate facilities
therefor, and, in the case of wire transfers, at the expense of such Person
unless such Person shall own of record Class D Notes which have Initial Class D
Principal Balances aggregating at least $500,000.



A-5-5









 





     Notwithstanding the above, the final distribution on this Class D Note
will be made after due notice by the Indenture Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class D Note at
the office or agency maintained for that purpose by the Note Registrar in New
York, New York.



     As provided in the Indenture and the Sale and Servicing Agreement,
deposits and withdrawals from the Note Distribution Account, the Principal and
Interest Account and the Reserve Fund may be made by the Indenture Trustee from
time to time for purposes other than distributions to Class D Noteholders, such
purposes including reimbursement to the Servicer of advances made, or certain
expenses incurred, by it, and investment in Permitted Investments.



     As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Class D Note is registrable in the Note
Register upon surrender of this Class D Note for registration of transfer at
the offices or agencies maintained by the Note Registrar in New York, New York,
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to, the Indenture Trustee, duly executed by the holder hereof or
such holder’s attorney duly authorized in writing, and thereupon one or more
new Class D Notes in authorized denominations evidencing the same aggregate
undivided Percentage Interest will be issued to the designated transferee or
transferees.



     The Class D Note is issuable only as a registered Class D Note. As
provided in the Indenture and subject to certain limitations therein set forth,
the Class D Note is exchangeable for a new Class D Note evidencing the same
undivided ownership interest, as requested by the holder surrendering the same.



     No service charge will be made for any such registration of transfer or
exchange, but the Note Registrar may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.



     The Servicer, the Trust Depositor, the Indenture Trustee and the Note
Registrar, and any agent of any of the foregoing, may treat the person in whose
name this Class D Note is registered as the owner hereof for all purposes, and
none of the foregoing shall be affected by notice to the contrary.



     The obligations and responsibilities created by the Indenture with respect
to this Class D Note shall terminate upon the payment to Class D Noteholders of
all amounts required to be paid to them pursuant to the Indenture and the Sale
and Servicing Agreement and the disposition of all property held as part of the
Indenture Collateral with respect to this Class D Note.



A-5-6









 






SCHEDULE OF EXCHANGES OF
INTERESTS IN THE GLOBAL NOTE9




     The following exchanges of a part of this Global Note for an interest in
another Global Note or for an Individual Note, or exchanges of a part of
another Global Note or Individual Note for an interest in this Global Note,
have been made:



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Amount of	 	Amount of	 	Principal Amount	 	 
	 	 	decrease in	 	increase in	 	of this Global	 	Signature of
	 	 	Principal Amount	 	Principal Amount	 	Note following	 	Responsible
	Date of	 	of this Global	 	of this Global	 	such decrease	 	Officer of Note
	Exchange
	 	Note
	 	Note
	 	(or increase)
	 	Registrar

	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 













	9	 	This should be included only if the Note is issued in global form.




A-5-7









 










ASSIGNMENT




Social Security or taxpayer I.D. or other identifying number of assignee



FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto











(name and address of assignee)




the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints        , attorney, to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.



	 	 	 	 	 
	Dated:

	


	 	


	 10







Signature Guaranteed:







10     NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.



A-5-8









 








EXHIBIT A–6




[FORM OF CLASS E NOTE]




CAPITALSOURCE COMMERCIAL LOAN TRUST 2004-1




THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES
OR BLUE SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE,
AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER REQUIREMENTS
OF LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE
144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (2) IN CERTIFICATED FORM TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501 (a)(1)–(3) OR (7) UNDER
THE SECURITIES ACT) THAT IS ALSO A QUALIFIED PURCHASER FOR PURPOSES OF SECTION
3(c)(7) UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, PURCHASING FOR
INVESTMENT AND NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, IN EACH
CASE, SUBJECT TO (A) THE RECEIPT BY THE INDENTURE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE INDENTURE AND (B) THE RECEIPT BY THE
INDENTURE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER REQUIREMENTS OF LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND
BLUE SKY LAWS OF ANY STATE OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION, (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO ANOTHER
EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY
APPLICABLE STATE SECURITIES LAWS, OR (5) PURSUANT TO A VALID REGISTRATION
STATEMENT. THE PURCHASE OF THIS NOTE WILL BE DEEMED A REPRESENTATION BY THE
ACQUIRER THAT IT IS NOT, AND IS NOT PURCHASING THIS NOTE FOR, ON BEHALF OF OR
WITH PLAN ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
WHICH IS SUBJECT TO TITLE I OF ERISA AND/OR SECTION 4975 OF THE CODE.



     THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF



A-6-1









 





THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE
HEREOF.



     THIS CLASS E NOTE IS A PRINCIPAL ONLY NOTE AND DOES NOT BEAR ANY INTEREST.



     THIS CLASS E NOTE MAY NOT BE TRANSFERRED DIRECTLY OR INDIRECTLY TO (1)
EMPLOYEE BENEFIT PLANS, RETIREMENT ARRANGEMENTS, INDIVIDUAL RETIREMENT ACCOUNTS
OR KEOGH PLANS SUBJECT TO EITHER TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, OR (2) ENTITIES (INCLUDING INSURANCE COMPANY GENERAL
ACCOUNTS) WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY SUCH
PLAN’S ARRANGEMENTS OR ACCOUNT’S INVESTMENT IN SUCH ENTITIES. FURTHER, THIS
NOTE MAY BE TRANSFERRED ONLY TO A UNITED STATES PERSON WITHIN THE MEANING OF
SECTION 7701(a)(30) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.



     NO TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION OF ONE OR MORE CLASS E
NOTES (A “TRANSFER”) SHALL BE MADE UNLESS SIMULTANEOUSLY WITH THE
TRANSFER (1) A PROPORTIONATE AMOUNT OF TRUST CERTIFICATES ARE TRANSFERRED SO
THAT THE RATIO OF THE PERCENTAGE INTEREST OF THE TRUST CERTIFICATES SO
TRANSFERRED TO ALL TRUST CERTIFICATES AND THE RATIO OF THE PERCENTAGE INTEREST
OF THE CLASS E NOTES SO TRANSFERRED TO THE PERCENTAGE INTEREST OF ALL CLASS E
NOTES ARE EQUAL, (2) THE TRANSFERS OF THE TRUST CERTIFICATES AND CLASS E NOTES
REFERRED TO HEREIN ARE MADE TO THE SAME PERSON, AND (3) THE PERCENTAGE INTEREST
OF THE TRUST CERTIFICATES AND CLASS E NOTES, RESPECTIVELY, SO TRANSFERRED IS NO
LESS THAN TEN (10%) PERCENT.



     THE RIGHTS OF THE HOLDERS OF THIS CLASS E NOTE TO RECEIVE PRINCIPAL ARE
SUBORDINATED TO THE RIGHTS OF THE HOLDERS OF THE CLASS A-1 NOTES, THE CLASS A-2
NOTES, THE CLASS B NOTES, THE CLASS C NOTES AND THE CLASS D NOTES TO RECEIVE
PRINCIPAL AND INTEREST TO THE EXTENT SET FORTH IN THE SALE AND SERVICING
AGREEMENT.



A-6-2









 





			
	 	 	 
	REGISTERED
	 	$                        
	 	 	 
	No. E-
	 	June
[     ], 2004
	 	 	 







SEE REVERSE FOR CERTAIN DEFINITIONS




     CapitalSource Commercial Loan Trust 2004-1, a statutory trust organized
and existing under the laws of the State of Delaware (herein referred to as the
“Issuer”), for value received, hereby promises to pay to
       , or registered assigns, the principal sum of
       
DOLLARS payable on each Remittance Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is the initial
principal balance of this Class E Note and the denominator of which is the
Initial Class E Principal Balance by (ii) the aggregate amount, if any, payable
from the Note Distribution Account in respect of principal on the Class E Notes
pursuant to Section 3.05 of the Indenture.



     Distributions on this Class E Note are payable in such coin or currency of
the United States as at the time of payment is legal tender for payment of
public and private debts.



     Reference is made to the further provisions of this Class E Note set forth
on the reverse hereof, which shall have the same effect as though fully set
forth on the face of this Class E Note.



     Unless the certificate of authentication hereon has been executed by the
Indenture Trustee whose name appears below by manual signature, this Class E
Note shall not be entitled to any benefit under the Indenture referred to on
the reverse hereof, or be valid or obligatory for any purpose.



A-6-3









 





     IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Responsible Officer as of the date set forth
below.



	 	 	 	 	 	 	 
	 	 	CAPITALSOURCE COMMERCIAL LOAN
	 	 	TRUST 2004-1
	 
	 	 	 	 	 	 
	 	 	By:	 	WILMINGTON TRUST COMPANY, not in its

individual capacity but solely as Owner Trustee under the Trust Agreement
	 
	 	 	 	 	 	 
	

	 	 	 	By:
	 	



	

	 	 	 	 	 	Authorized Signatory







INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION




     This is one of the Class E Notes of CapitalSource Commercial Loan Trust 2004-1
designated above and referred to in the within–mentioned Indenture.



	 	 	 	 	 
	 	 	WELLS FARGO BANK,
	 	 	NATIONAL ASSOCIATION, not in its individual
	 	 	capacity but solely as Indenture Trustee,
	 
	 	 	 	 
	

	 	By:
	 	


	

	 	 	 	Authorized Signatory







A-6-4









 






[REVERSE OF NOTE]




     This Class E Note is one of a duly authorized issue of Class E Notes of
the Issuer, designated as its CapitalSource Commercial Loan Trust Notes, Series
2004-1, Class E (herein called the “Class E Notes”), all issued under an
Indenture dated as of June 22, 2004 (such indenture, as supplemented or
amended, is herein called the “Indenture”), between the Issuer and Wells
Fargo Bank, National Association, as indenture trustee (the “Indenture
Trustee”, which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Class E Notes. The Class E Notes are subject to all terms of the
Indenture. All terms used in this Class E Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.



     Notwithstanding the foregoing, the entire unpaid principal amount of the
Class E Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee, or the
Majority Noteholders have declared the Class E Notes to be immediately due and
payable in the manner provided in Section 5.02 of the Indenture. All
principal payments on the Class E Notes shall be made pro rata to the Class E
Noteholders entitled thereto.



     Each Class E Noteholder or Class E Note Owner, by acceptance of a Class E
Note or, in the case of a Class E Note Owner, a beneficial interest in a Class
E Note covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer under the Indenture
on the Class E Notes or under any certificate or other writing delivered in
connection therewith, against the Trust Depositor, the Servicer, the Indenture
Trustee or the Owner Trustee in its individual capacity or any of their
Affiliates.



     On each Remittance Date, commencing July 20, 2004, the Indenture Trustee
or Paying Agent shall distribute to the Person in whose name this Class E Note
is registered on the close of business on the Record Date an amount equal to
the product of the Percentage Interest of the Class E Notes evidenced by this
Class E Note and the amount required to be distributed to Holders of Class E
Notes on such Remittance Date pursuant to Section 3.05 of the Indenture.



     Distributions on this Class E Note will be made by the Indenture Trustee
or Paying Agent by check mailed to the address of the Person entitled thereto
as such name and address shall appear on the Note Register or, upon written
request to the Indenture Trustee, by wire transfer of immediately available
funds to the account of the Person entitled thereto as shall appear on the Note
Register without the presentation or surrender of this Note or the making of
any notation thereon, at a bank or other entity having appropriate facilities
therefor, and, in the case of wire transfers, at the expense of such Person
unless such Person shall own of record Class E Notes which have Initial Class E
Principal Balances aggregating at least $500,000.



     Notwithstanding the above, the final distribution on this Class E Note
will be made after due notice by the Indenture Trustee of the pendency of such
distribution and only upon
presentation and surrender of this Class E Note at the office or agency
maintained for that purpose by the Note Registrar in New York, New York.



A-6-5









 





     As provided in the Indenture and the Sale and Servicing Agreement,
deposits and withdrawals from the Note Distribution Account, the Principal and
Interest Account and the Reserve Fund may be made by the Indenture Trustee from
time to time for purposes other than distributions to Class E Noteholders, such
purposes including reimbursement to the Servicer of advances made, or certain
expenses incurred, by it, and investment in Permitted Investments.



     As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Class E Note is registrable in the Note
Register upon surrender of this Class E Note for registration of transfer at
the offices or agencies maintained by the Note Registrar in New York, New York,
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to, the Indenture Trustee, duly executed by the holder hereof or
such holder’s attorney duly authorized in writing, and thereupon one or more
new Class E Notes in authorized denominations evidencing the same aggregate
undivided Percentage Interest will be issued to the designated transferee or
transferees.



     The Class E Note is issuable only as a registered Class E Note. As
provided in the Indenture and subject to certain limitations therein set forth,
the Class E Note is exchangeable for a new Class E Note evidencing the same
undivided ownership interest, as requested by the holder surrendering the same.



     No service charge will be made for any such registration of transfer or
exchange, but the Note Registrar may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.



     The Servicer, the Trust Depositor, the Indenture Trustee and the Note
Registrar, and any agent of any of the foregoing, may treat the person in whose
name this Class E Note is registered as the owner hereof for all purposes, and
none of the foregoing shall be affected by notice to the contrary.



     The obligations and responsibilities created by the Indenture shall
terminate upon the payment to Class E Noteholders of all amounts required to be
paid to them pursuant to the Indenture and the Sale and Servicing Agreement and
the disposition of all property held as part of the Indenture Collateral.



A-6-6









 





ASSIGNMENT




Social Security or taxpayer I.D. or other identifying number of assignee



FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto











(name and address of assignee)




the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints       , attorney, to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.

 

	 	 	 	 	 
	Dated:

	


	 	


	 8








Signature Guaranteed:







11     NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.




A-6-7









 





EXHIBIT B




LIST OF LOANS




See Exhibit G of the Sale and Servicing Agreement.




B-1









 








EXHIBIT C




WIRING INSTRUCTIONS FORM




_______________, 2004




[Paying Agent]

[Trustee]












	 	 	 
	Re:

	 	CapitalSource Commercial Loan Trust Notes, Series 2004-1, [Class
A-1] [Class A-2] [Class B] [Class C] [Class D] [Class E]







Dear Sir:




In connection with the sale of the above–captioned Note by                                                          
to                                                          ,
(“Transferee”) you, as Paying Agent, are instructed to make
all remittances to Transferee as Noteholder as of                                       ,                     by wire
transfer. For such wire transfer, the wiring instructions are as follows:





















	 	 	 
	

	 	

	

	 	      Transferee







Noteholder’s mailing address:




Name:




Address:




C-1









 








EXHIBIT D–1




FORM OF TRANSFEREE LETTER




CapitalSource Finance LLC,
  as
the Servicer

4445 Willard Avenue, 12th Floor

Chevy Chase, Maryland 20815

Attention: Controller



Wells Fargo Bank, National Association,
  as
the Indenture Trustee

Sixth and Marquette Avenue, MAC N9311–161

Minneapolis, Minnesota 55479

Attention: Corporate Trust Services/Asset Backed Administration



                                      , 20                      



	 	 	 
	Re:

	 	CapitalSource Commercial Loan
Trust Notes, Series 2004-1

Class A-1, Class A-2, Class B, Class C, Class D and Class E
Notes







Ladies and Gentlemen:




In connection with our acquisition of the above–captioned Notes, we certify
that (a) we understand that the Notes are not being registered under the
Securities Act of 1933, as amended (the “Act”), or any state
securities laws and are being transferred to us in a transaction that is exempt
from the registration requirements of the Act and any such laws, (b) we are an
institutional “Accredited Investor,” as defined in the Indenture pursuant to
which the Notes were issued (the “Indenture”), and a
“Qualified Purchaser” for purposes of Section 3(c)(7) under the Investment
Company Act of 1940, as amended, and have such knowledge and experience in
financial and business matters that we are capable of evaluating the merits and
risks of investments in the Notes, (c) we have had the opportunity to ask
questions of and receive answers from the Originator and the Servicer
concerning the purchase of the Notes and all matters relating thereto or any
additional information deemed necessary to our decision to purchase the Notes,
(d) we are acquiring the Notes for investment for our own account and not with
a view to any distribution of such Notes (but without prejudice to our right at
all times to sell or otherwise dispose of the Notes in accordance with
clause (f) below), (e) we have not offered or sold any Notes
to, or solicited offers to buy any Notes from, any person, or otherwise
approached or negotiated with any person with respect thereto, or taken any
other action which would result in a violation of Section 5 of the Act, (f) we
will not sell, transfer or otherwise dispose of any Notes unless (1) such sale,
transfer or other disposition is made pursuant to an effective registration
statement under the Act or is exempt from such registration requirements, and
if requested, we will at our expense provide an opinion of counsel satisfactory
to the addressees of this certificate that such sale, transfer or other
disposition may be made pursuant to an exemption from the Act, (2) the
purchaser or transferee of such Note has executed and delivered to you a
certificate to substantially the same effect as this certificate if required by
the Indenture, and (3) the purchaser or transferee has otherwise complied with
any conditions for



D-1-1









 








transfer set forth in the Indenture, (g) the purchaser is not acquiring a Class
A-1 Note, Class A-2 Note, Class B Note, Class C Note or Class D Note, directly
or indirectly, for or on behalf of an employee benefit plan or other retirement
arrangement subject to the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), and/or Section 4975 of the Internal
Revenue Code of 1986, as amended (the “Code”); unless the
purchaser is acquiring a Class A-1, Class A-2, Class B, Class C or Class D Note
and Prohibited Transaction Class Exemption (“PTCE”) 84–14,
PTCE 90–1, PTCE 91–38, PTCE 95–60 or PTCE 92–23 or some other applicable
prohibited transaction exemption is applicable to the acquisition and holdings
of such Class A-1, Class A-2, Class B, Class C or Class D Note, (h) the
purchaser is not acquiring a Class E Note, directly or indirectly, for or on
behalf of an employee benefit plan or other retirement arrangements subject to
ERISA and/or Section 4975 of the Code, (i) if the purchaser is acquiring a
Class E Note, the purchaser is a U.S. Person, as such term is defined in
Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended, and (j)
if the purchaser is acquiring a Class E Note, the purchaser also is acquiring
Trust Certificates such that the ratio and the Percentage Interest of the Trust
Certificates being acquired to all Trust Certificates and the ratio and the
Percentage Interest of the Class E Notes being acquired to all Class E Notes
are equal.



	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	

	 	 	Print Name of Transferee
	 
	

	 	By:	 	 
	

	 	 	 	

	

	 	 	 	     Responsible Officer







D-1-2









 






EXHIBIT D–2




FORM OF RULE 144A CERTIFICATION




CapitalSource Finance LLC,
  
as the Servicer

4445 Willard Avenue, 12th Floor

Chevy Chase, Maryland 20815

Attention: Controller



Wells Fargo Bank, National Association,
  as
the Indenture Trustee

Sixth and Marquette Avenue, MAC N9311–161

Minneapolis, Minnesota 55479

Attention: Corporate Trust Services/Asset Backed Administration



                                      , 20                   



	 	 	 
	Re:

	 	CapitalSource Commercial Loan
Trust Notes, Series 2004-1

Class A-1, Class A-2, Class B, Class C, Class D and Class E
Notes







Ladies and Gentlemen:




In connection with our acquisition any of the above Notes we certify that (a)
we understand that the Notes are not being registered under the Securities Act
of 1933, as amended (the “Act”), or any state securities
laws and are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have had the
opportunity to ask questions of and receive answers from Originator and the
Servicer concerning the purchase of the Notes and all matters relating thereto
or any additional information deemed necessary to our decision to purchase the
Notes, (c) we have not, nor has anyone acting on our behalf offered,
transferred, pledged, sold or otherwise disposed of the Notes, any interest in
the Notes or any other similar security to, or solicited any offer to buy or
accept a transfer, pledge or other disposition of the Notes, any interest in
the Notes or any other similar security from, or otherwise approached or
negotiated with respect to the Notes, any interest in the Notes or any other
similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken
any other action, that would constitute a distribution of the Notes under the
Act or that would render the disposition of the Notes a violation of Section 5
of the Act or require registration pursuant thereto, nor will act, nor has
authorized or will authorize any person to act, in such manner with respect to
the Notes, (d) we are a “qualified institutional buyer” as that term is defined
in Rule 144A under the Act and have completed the form of certification to that
effect attached hereto as Annex 1, (e) we are not acquiring a Class A-1 Note,
Class A-2 Note, Class B Note, Class C Note, or Class D Note, directly or
indirectly, for or on behalf of an employee benefit plan or other retirement
arrangement subject to the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), and/or Section 4975 of the Internal
Revenue Code of 1986, as amended (the “Code”); unless we are
acquiring a Class A-1 Note, Class A-2 Note, Class B Note, Class C Note or Class
D Note and Prohibited Transaction Class Exemption (“PTCE”)
84–14, PTCE 90–1, PTCE 91–38, PTCE 95–



D-2-1









 








60 or PTCE 92–23 or some other applicable prohibited transaction exemption is
applicable to the acquisition and holdings of such Class A-1 Note, Class A-2
Note, Class B Note, Class C Note or Class D Note, (f) we are not acquiring a
Class E Note, directly or indirectly, for or on behalf of an employee benefit
plan or other retirement arrangements subject to ERISA and/or Section 4975 of
the Code, (g) if we are acquiring a Class E Note, we are a U.S. Person, as such
term is defined in Section 7701(a)(30) of the Internal Revenue Code of 1986, as
amended, and (h) if the purchaser is acquiring a Class E Note, we also are
acquiring Trust Certificates such that the ratio and the Percentage Interest of
the Trust Certificates being acquired to all Trust Certificates and the ratio
and the Percentage Interest of the Class E Notes being acquired to all Class E
Notes are equal. We are aware that the sale to us is being made in reliance on
Rule 144A. We are acquiring the Notes for our own account or for resale
pursuant to Rule 144A and further, understand that such Notes may be resold,
pledged or transferred only (i) to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A, or (ii)
pursuant to another exemption from registration under the Act.



	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	

	 	 	Print Name of Transferee
	 
	

	 	By:	 	 
	

	 	 	 	

	

	 	 	 	     Responsible Officer







D-2-2









 






ANNEX 1 TO EXHIBIT D–2




[FORM OF CERTIFICATION]




[Date]




CapitalSource Finance LLC,
  as
the Servicer

4445 Willard Avenue, 12th Floor

Chevy Chase, Maryland 20815

Attention: Controller



Wells Fargo Bank, National Association,
  as
the Indenture Trustee

Sixth and Marquette Avenue, MAC N9311–161

Minneapolis, Minnesota 55479

Attention: Corporate Trust Services/Asset Backed Administration



	 	 	 
	Re:

	 	CapitalSource Commercial Loan
Trust Notes, Series 2004-1

Class A-1, Class A-2, Class B, Class C, Class D and Class E
Notes







Ladies and Gentlemen:




In connection with our purchase of the Notes, the undersigned certifies to each
of the parties to whom this letter is addressed that it is a qualified
institutional buyer (as defined in Rule 144A under the Securities Act of 1933,
as amended (the “Act”)) as follows:




	1.	 	It owns and/or invests on a discretionary basis eligible securities
(excluding affiliate’s securities, bank deposit notes and CD’s, loan
participations, repurchase agreements, securities owned but subject to a
repurchase agreement and currency, interest rate and commodity swaps), as
described below:
	 
	 	 	Amount: $                                      ; and
	 
	2.	 	The dollar amount set forth above is:





	 	 	 	 	 	 	 	 	 
	a.	 	 	 	 	 	greater than $100 million and the undersigned is one of the following
entities:

	 
	 	 	 	 	 	 	 	 
	

	 	 	(1	)	 	o
	 	an insurance company as defined in Section
2(13) of the Act;* or
	 
	 	 	 	 	 	 	 	 
	

	 	 	(2	)	 	o
	 	an investment company registered under the
Investment Company Act or any business development company as
defined in Section 2(a)(48)













*
       A purchase by an insurance company for one or more of its separate accounts,
as defined by section 2(a)(37) of the Investment Company Act of 1940, which are
neither registered nor required to be registered thereunder, shall be deemed to
be a purchase for the account of such insurance company.



D-2-1









 








	 	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	of the Investment Company Act of 1940 or as defined in
Section 202(a)(22) of the Investment Advisers Act of 1940;
or
	 
	 	 	 	 	 	 	 	 
	

	 	 	(3	)	 	o
	 	a Small Business Investment Company
licensed by the U.S. Small Business Administration under Section
301(c) or (d) of the Small Business Investment Act of 1958; or
	 
	 	 	 	 	 	 	 	 
	

	 	 	(4	)	 	o
	 	a plan (i) established and maintained by a
state, its political subdivisions, or any agency or
instrumentality of a state or its political subdivisions, the
laws of which permit the purchase of securities of this type, for
the benefit of its employees and (ii) the governing investment
guidelines of which permit the purchase of securities of this
type; or
	 
	 	 	 	 	 	 	 	 
	

	 	 	(5	)	 	o
	 	a corporation (other than a U.S. bank,
savings and loan association or equivalent foreign institution),
partnership, Massachusetts or similar statutory or business
trust, or an organization described in Section 501(c)(3) of the
Internal Revenue Code; or
	 
	 	 	 	 	 	 	 	 
	

	 	 	(6	)	 	o
	 	a U.S. bank, savings and loan association
or equivalent foreign institution, which has an audited net worth
of at least $25 million as demonstrated in its latest annual
financial statements as of a date not more than 16 months
preceding the date of sale in the case of a U.S. institution or
18 months in the case of a foreign institution; or
	 
	 	 	 	 	 	 	 	 
	

	 	 	(7	)	 	o
	 	an investment adviser registered under the
Investment Advisers Act; or
	 
	 	 	 	 	 	 	 	 
	b.	 	o
	 	greater than $10 million, and the undersigned is
a broker–dealer registered with the SEC; or
	 
	 	 	 	 	 	 	 	 
	c.	 	o
	 	less than $10 million, and the undersigned is a
broker–dealer registered with the SEC and will only purchase Rule
144A securities in riskless principal transactions (as defined in
Rule 144A); or
	 
	 	 	 	 	 	 	 	 
	d.	 	o
	 	less than $100 million, and the undersigned is
an investment company registered under the Investment Company Act of
1940, which, together with one or more registered investment
companies having the same or an affiliated investment adviser, owns
at least $100 million of eligible securities; or
	 
	 	 	 	 	 	 	 	 
	e.	 	o
	 	less than $100 million, and the undersigned is
an entity, all the equity owners of which are qualified
institutional buyers.







     The undersigned further certifies that it is purchasing Notes for its own
account or for the account of others that independently qualify as “Qualified
Institutional Buyers” as defined in Rule 144A. It is aware that the sale of
the Notes is being made in reliance on its continued compliance with Rule 144A.
It is aware that the transferor may rely on the exemption from the provisions
of Section 5 of the Act provided by Rule 144A. The undersigned understands
that the Notes may be resold, pledged or transferred pursuant to Rule 144A only
to a person reasonably



D-2-2









 







believed to be a Qualified Institutional Buyer that purchases for its own
account or for the account of a Qualified Institutional Buyer to whom notice is
given that the resale, pledge or transfer is being made in reliance in Rule
144A.



     The undersigned agrees that if at some time before the expiration of the
holding period described in Rule 144 it wishes to dispose of or exchange any of
the Notes, it will not transfer or exchange any of the Notes to a Qualified
Institutional Buyer without first obtaining a letter in the form hereof from
the transferee and delivering such certificate to the addressees hereof.



     IN WITNESS WHEREOF, this document has been executed by the undersigned who
is duly authorized to do so on behalf of the undersigned Qualified
Institutional Buyer on the                       day of                                       ,                    .



Name of Institution

Signature

Name

Title**









**   Must be President, Chief Financial Officer, or other executive officer.



D-2-3









 








EXHIBIT E




FORM OF TRANSFER CERTIFICATE FOR RULE 144A GLOBAL NOTE TO

REGULATION S GLOBAL NOTE DURING DISTRIBUTION COMPLIANCE PERIOD




(Pursuant to Section 4.02(j)(i) of the Indenture)




Wells Fargo Bank, National Association,
  as
the Indenture Trustee

Sixth and Marquette Avenue, MAC N9311–161

Minneapolis, Minnesota 55479

Attention: Corporate Trust Services/Asset Backed Administration



	 	 	 
	Re:

	 	CapitalSource Commercial Loan
Trust Notes, Series 2004-1

Class [A-1], [A-2], [B], [C] and [D]







Ladies and Gentlemen:




Reference is hereby made to the Indenture, dated as of June 22, 2004 (as
amended, modified, waived, supplemented or restated from time to time, the
“Agreement”), between CapitalSource Commercial Loan Trust
2004-1, as the issuer (together with its successors and assigns in such
capacity, the “Issuer”), and Wells Fargo Bank, National
Association, as the indenture trustee (together with its successors and assigns
in such capacity, the “Trustee”). Capitalized terms used
but not defined herein shall have the meanings given to them in the Agreement.



This letter relates to US $[                   ] aggregate current principal amount of
Class                
    Notes (the “Notes”) which are held in the form of
the Rule 144A Global Note (CUSIP No.                    ) with the Depository in the name
of [insert name of transferor] (the “Transferor”). The
Transferor has requested a transfer of such beneficial interest in the Notes
for an interest in the Regulation S Global Note (CUSIP No.                    ) to be
held with [Euroclear] [Clearstream] (Common Code No.                   ) through the
Depository.



In connection with such request and in respect of such Notes, the Transferor
does hereby certify that such transfer has been effected in accordance with the
transfer restrictions set forth in the Agreement and pursuant to and in
accordance with Regulation S under the Securities Act of 1933, as amended (the
“Securities Act”), and accordingly the Transferor does
hereby certify that:




	 	(1)	 	the offer of the Notes was not made to a person in the United
States,
	 
	 	(2)	 	[at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person acting on
its behalf reasonably believed that the transferee was outside the
United States] [the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither
the Transferor nor any person acting on its behalf knows that the
transaction was pre–arranged with a buyer in the United States],
	 
	 	(3)	 	the transferee is not a U.S. Person within the meaning of
Rule 902(o) of Regulation S nor a Person acting for the account or
benefit of a U.S. Person,




E-1









 






	 	(4)	 	no directed selling efforts have been made in contravention
of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable,
	 
	 	(5)	 	the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act, and
	 
	 	(6)	 	upon completion of the transaction, the beneficial interest
being transferred as described above will be held with the
Depository through [Euroclear] [Clearstream].





This certificate and the statements contained herein are made for your benefit
and the benefit of the Trustee, the Issuer and the Placement Agents of the
offering of the Notes.



	 	 	 	 	 
	 	 	[Insert Name of Transferor]
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	



	

	 	Name:	 	 
	

	 	 	 	



	

	 	Title:	 	 
	

	 	 	 	








Dated:




E-2









 








EXHIBIT F




FORM OF TRANSFER CERTIFICATE FOR RULE 144A GLOBAL NOTE TO

REGULATION S GLOBAL NOTE AFTER DISTRIBUTION COMPLIANCE PERIOD




(Pursuant to Section 4.02(j)(ii) of the Indenture)




Wells Fargo Bank, National Association,
  as
the Indenture Trustee

Sixth and Marquette Avenue, MAC N9311–161

Minneapolis, Minnesota 55479

Attention: Corporate Trust Services/Asset Backed Administration



	 	 	 
	Re:

	 	CapitalSource Commercial Loan
Trust Notes, Series 2004-1

Class [A-1], [A-2], [B], [C] and [D]







Ladies and Gentlemen:




Reference is hereby made to the Indenture, dated as of June 22, 2004 (as
amended, modified, waived, supplemented or restated from time to time, the
“Agreement”), between CapitalSource Commercial Loan Trust
2004-1, as the issuer (together with its successors and assigns in such
capacity, the “Issuer”), and Wells Fargo Bank, National
Association, as the indenture trustee (the “Trustee”).
Capitalized terms used but not defined herein shall have the meanings given to
them in the Agreement.



This letter relates to US $[                   ] aggregate current principal amount of
Class                    
 Notes (the “Notes”) which are held in the form of
the Rule 144A Global Note (CUSIP No.        
           ) with the Depository in the name
of [insert name of transferor] (the “Transferor”). The
Transferor has requested a transfer of such beneficial interest in the Notes
for an interest in the Regulation S Global Note (Common Code No.                    ).



In connection with such request, and in respect of such Notes, the Transferor
does hereby certify that such transfer has been effected in accordance with the
transfer restrictions set forth in the Agreement and, (i) with respect to
transfers made in reliance on Regulation S under the Securities Act of 1933, as
amended (the “Securities Act”), the Transferor does hereby
certify that:




	 	(1)	 	the offer of the Notes was not made to a person in the United
States;
	 
	 	(2)	 	[at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person acting on
its behalf reasonably believed that the transferee was outside the
United States] [the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither
the Transferor nor any person acting on its behalf knows that the
transaction was pre–arranged with a buyer in the United States];
	 
	 	(3)	 	no directed selling efforts have been made in contravention
of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable; and




F-1









 






	 	(4)	 	the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act,





or (ii) with respect to transfers made in reliance on Rule 144 under the
Securities Act, the Transferor does hereby certify that the Notes that are
being transferred are not “restricted securities” as defined in Rule 144 under
the Securities Act.



This certificate and the statements contained herein are made for your benefit
and the benefit of the Trustee, the Issuer and the Placement Agents of the
offering of the Notes.



	 	 	 	 	 
	 	 	[Insert Name of Transferor]
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	


	

	 	Name:	 	 
	

	 	 	 	


	

	 	Title:	 	 
	

	 	 	 	








Dated:




F-2









 








EXHIBIT G




FORM OF TRANSFER CERTIFICATE REGULATION S GLOBAL NOTE

TO RULE 144A GLOBAL NOTE DURING DISTRIBUTION COMPLIANCE PERIOD




(Pursuant to Section 4.02(j)(iii)(3)(i) of the Indenture)




Wells Fargo Bank, National Association,
  as
the Indenture Trustee

Sixth and Marquette Avenue, MAC N9311–161

Minneapolis, Minnesota 55479

Attention: Corporate Trust Services/Asset Backed Administration



	 	 	 
	Re:

	 	CapitalSource Commercial Loan
Trust Notes, Series 2004-1

Class [A-1], [A-2], [B], [C] and [D]







Ladies and Gentlemen:




Reference is hereby made to the Indenture, dated as of June 22, 2004 (as
amended, modified, waived, supplemented or restated from time to time, the
“Agreement”), between CapitalSource Commercial Loan Trust
2004-1, as the issuer (together with its successors and assigns in such
capacity, the “Issuer”), and Wells Fargo Bank, National
Association, as the indenture trustee (together with its successors and assigns
in such capacity, the “Trustee”). Capitalized terms used
but not defined herein shall have the meanings given to them in the Agreement.



This letter relates to US $[                   ] aggregate current principal amount of
Class                    
 Notes (the “Notes”) which are held in the form of
the Regulation S Global Note (CUSIP No.      
             ) with [Euroclear] [Clearstream]
(Common Code No.                   ) through the Depository in the name of [insert name
of transferor] (the “Transferor”). The Transferor has
requested a transfer of such beneficial interest in the Notes for an interest
in the Regulation 144A Global Note (CUSIP No.                   ).



In connection with such request, and in respect of such Notes, the Transferor
does hereby certify that such Notes are being transferred in accordance with
(i) the transfer restrictions set forth in the Agreement and (ii) Rule 144A
under the Securities Act to a transferee that the Transferor reasonably
believes is purchasing the Notes for its own account with respect to which the
transferee exercises sole investment discretion and the transferee and any such
account is a “qualified institutional buyer” within the meaning of Rule 144A,
in each case in a transaction meeting the requirements of Rule 144A and in
accordance with any applicable securities laws of any state of the United
States or any jurisdiction.



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This certificate and the statements contained herein are made for your benefit
and the benefit of the Trustee, the Issuer and the Placement Agents of the
offering of the Notes.



	 	 	 	 	 
	 	 	[Insert Name of Transferor]
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	


	

	 	Name:	 	 
	

	 	 	 	


	

	 	Title:	 	 
	

	 	 	 	








Dated:




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EXHIBIT H




FORM OF TRANSFER CERTIFICATE FOR REGULATION S

GLOBAL NOTE DURING DISTRIBUTION COMPLIANCE PERIOD




(Pursuant to Section 4.02(l)(iv)(3) of the Indenture)




Wells Fargo Bank, National Association,
  
as the Indenture Trustee

Sixth and Marquette Avenue, MAC N9311–161

Minneapolis, Minnesota 55479

Attention: Corporate Trust Services/Asset Backed Administration



	 	 	 
	Re:

	 	CapitalSource Commercial Loan
Trust Notes, Series 2004-1

Class [A-1], [A-2], [B], [C] and [D]







Ladies and Gentlemen:




This certificate is delivered pursuant to Section 4.02 of
the Indenture, dated as of June 22, 2004 (as amended, modified, waived,
supplemented or restated from time to time, the
“Agreement”), between CapitalSource Commercial Loan Trust
2004-1, as the issuer (together with its successors and assigns in such
capacity, the “Issuer”), and Wells Fargo Bank, National
Association, as the indenture trustee (together with its successors and assigns
in such capacity, the “Trustee”), in connection with the
transfer by the undersigned (the “Transferor”) to
                 
                     (the “Transferee”) of $                                         
current principal amount of Class                       Notes, in fully registered form (each, an
“Individual Note”), or a beneficial interest of such
aggregate current principal amount in the Regulation S Global Note (the
“Global Note”) maintained by The Depository Trust Company or
its successor as Depository under the Agreement (such transferred interest, in
either form, being the “Transferred Interest”).



In connection with such transfer, the Transferor does hereby certify that such
transfer has been effected in accordance with the transfer restrictions set
forth in the Agreement and the Notes and (i) with respect to transfers made in
accordance with Regulation S (“Regulation S”) promulgated
under the Securities Act of 1933, as amended (the “Securities
Act”), the Transferor does hereby certify that:




	 	(1)	 	the offer of the Transferred Interest was not made to a
person in the United States;
	 
	 	(2)	 	[at the time the buy order was originated, the Transferee was
outside the United States or the Transferor and any person acting on
its behalf reasonably believed that the Transferee was outside the
United States] [the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither
the undersigned nor any person acting on its behalf knows that the
transaction was pre–arranged with a buyer in the United States];
	 
	 	(3)	 	the transferee is not a U.S. Person within the meaning of
Rule 902(o) of Regulation S nor a person acting for the account or
benefit of a U.S. Person, and




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	 	 	 	upon completion of the transaction, the Transferred Interest will
be held with the Depository through [Euroclear] [Clearstream];
	 
	 	(4)	 	no directed selling efforts have been made in contravention
of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable; and
	 
	 	(5)	 	the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.





or (ii) with respect to transfers made in reliance on Rule 144 under the
Securities Act, the Transferor does hereby certify that such Notes that are
being transferred are not “restricted securities” as defined in Rule 144 under
the Securities Act.



This certificate and the statements contained herein are made for your benefit
and the benefit of the Trustee, the Issuer and the Placement Agents of the
offering of the Notes.



	 	 	 	 	 
	 	 	[Insert Name of Transferor]
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	


	

	 	Name:	 	 
	

	 	 	 	


	

	 	Title:	 	 
	

	 	 	 	








Dated:





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